Toronto Star Referrer

In high demand

With U.S. facing a baby formula shortage, could it happen here?

ROSA SABA AND JOSHUA CHONG

The ongoing baby formula shortage that has plagued the U.S. for weeks and left parents scrambling to stock up is starting to spill over into Canada.

Worries about the shortage north of the border have experts and consumers asking why Canada isn’t producing more of its own formula — and why the biggest formula producer in the country doesn’t sell to Canadians.

Product shortages in the U.S. began in mid-2021 and were due in large part to a shortage of some raw ingredients used to make the formula, along with pandemic-related global supply issues.

The shortfall was further exacerbated in February, when certain Similac, Alimentum and EleCare products were recalled after reports of bacterial infections in four infants who consumed the powdered infant formula. All four infants were hospitalized, and two died.

Abbott Nutrition’s facility in Sturgis, Mich., where the product was

made — one of the major producers of baby formula for the U.S. market — was temporarily shuttered.

Michelle Wasylyshen, a spokesperson for the Retail Council of Canada, said Canadian retailers are starting to report shortages of baby formula.

“Because of the global shortage of raw ingredients, compounded by the closure of the facility in Michigan, what we’re seeing is a little bit of a trickle-down effect because other formula manufacturers are experiencing supply issues now as well, due to the increased demand for their products,” she told the Star.

Wasylyshen said the situation is less dire in Canada because most major grocery retailers here have private label baby formula products, the majority of which are sourced from competitors of Abbott.

In addition, to address any potential shortages in Canada, Health Canada recently enacted an interim policy to allow the importation of baby formula products approved for sale in other countries, which expires June 30.

“There’s no compromise on safety for any of these products. Health Canada still conducts a safety assessment for each,” said Wasylyshen. “Often, why some of these products are not always sold in Canada has to do with labelling requirements.”

Sylvain Charlebois, a professor in food distribution and policy at Dalhousie University, said Canadians are much less reliant on formula than their American counterparts, likely due to more generous parental leave policies.

That, plus Health Canada’s interim policy, will hopefully make the shortage less pronounced here, he said.

Wasylyshen stressed that the shortages are temporary.

Much of the concern here surrounds specialized formulas, such as products for infants with milk allergies, said Wasylyshen. “Those products continue to be in high demand and do not have easy substitutions,” she said.

Felicia Fefer, a spokesperson for Walmart Canada, said in a statement to the Star that despite ongoing global supply challenges, the retail corporation has secured a “strong supply of baby formula across multiple brands and formats.”

A spokesperson for Loblaw said the company is experiencing supply issues for one brand of baby formula due to a recall. “While this has left holes in our shelves, we do have a good supply of formula from our other vendors.”

But the fear of a shortage in Canada has also shed light on a littleknown fact: the largest baby formula producer in the country doesn’t sell its products to Canadians.

Canada Royal Milk is a Kingstonbased plant owned by a Chinese multinational company, which has received government funding through Ontario’s jobs and prosperity fund for the food and beverage sector. The plant, construction for which began in 2017, makes formula with Canadian cow and goat milk, and ships its products to China, said Charlebois.

Canadians essentially subsidize the dairy industry through the supply-management system, argued Charlebois. He thinks that if the company isn’t making products to be sold in Canada, it should have to buy its milk from outside the supply-management chain.

“That would be acceptable because it would no longer be supplymanaged, it would no longer be subsidized,” he said.

A spokesperson for the Canadian Dairy Commission said it is very common for processing companies in Canada to buy Canadian supplymanaged dairy and use it for products that are then exported.

However, Canada Royal Milk may be on the way to selling domestically. The company’s website states that while most of its production is intended for export, it plans to develop nutritional products for the North American market.

In an email to the Star, a company spokesperson said that Canada Royal Milk is “engaged in the premarket notification process for infant formula with Health Canada, and the company’s submission is under review.”

Meanwhile, Abbott, the company that operates the Michigan plant, has reached an agreement with the Food and Drug Administration, promising to address issues the agency identified.

In a Monday news release, Abbott said it can restart the site within two weeks once the FDA confirms its initial requirements have been met. However, the products won’t hit shelves for around six to eight weeks after the plant restarts.

Abbott’s chairman and CEO, Robert B. Ford, apologized in the release for the company’s role in worsening the formula shortage.

Though the shortage is less pronounced in Canada, the panic in the U.S. could lead to consumer uncertainty here, which could in turn lead to stockpiling, said Avni Shah, a consumer behaviour expert and a professor at the University of Toronto.

“There is evidence that when consumers are faced with uncertainty, like the availability of a particular product, people tend to stockpile,” said Shah, noting that panic buying could induce shortages even when there are few or no supply chain issues.

Wasylyshen said some retailers have already begun to limit the number of baby formula products customers may purchase, and Shah said such policies may feed into consumers’ fears.

What we’re seeing is a little bit of a trickle-down effect because other formula manufacturers are experiencing supply issues now as well.

MICHELLE WASYLYSHEN RETAIL COUNCIL OF CANADA

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2022-05-18T07:00:00.0000000Z

2022-05-18T07:00:00.0000000Z

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