Breaking News
Investing Pro 0
New Year’s SALE: Up to 40% OFF InvestingPro+ CLAIM OFFER

Enfamil maker Reckitt cranks up operations to put baby formula on U.S shelves

Stock Markets May 16, 2022 10:15PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. Mead Johnson's product Enfamil baby formula are displayed on a store shelf in New York City, U.S., February 10, 2017. REUTERS/Brendan McDermid/Files
 
AMZN
+3.04%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
WMT
+0.77%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
TGT
+0.89%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
ABT
-1.01%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
WBA
+1.84%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
PRGO
+1.53%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

By Richa Naidu

LONDON (Reuters) - Reckitt Benckiser is boosting baby formula production by about 30% and making more frequent deliveries to stores as it looks to counter a nationwide shortage in U.S. supermarkets, an executive told Reuters.

Reckitt, which makes its U.S. formula in three facilities in Michigan, Indiana and Minnesota, has also granted plants "unlimited overtime" to put in extra shifts, Robert Cleveland, senior vice president, North America and Europe Nutrition at Reckitt, told Reuters in an interview.

Along with cutting back on some items that take longer to produce, this has allowed the company to make about 30% more baby formula, he said. Reckitt has reduced the time it takes to get product to shelves by nearly half.

Baby formula aisles at supermarkets have been emptied by panicked parents since top U.S. manufacturer Abbott Laboratories (NYSE:ABT) in February recalled dozens of types of its Similac, Alimentum and EleCare formulas.

The products, which were made at a plant in Michigan, were recalled after complaints of bacterial infections.

The recall, which exacerbated a shortage of formula that started late last year, has forced supermarkets like Target Corp (NYSE:TGT) and Walgreens Boots Alliance (NASDAQ:WBA) to limit sales of formula, putting pressure on the Biden administration to address the crisis.

Prior to the Abbott recall, Reckitt supplied just over a third of the U.S. infant formula market compared with Abbott's roughly 44%. Britain-based Reckitt told Reuters it now accounts for more than 50% of total baby formula supply in the United States.

"We normally might pack an entire truck before we ship it. For timeliness, we're not doing that. We're packing it with as much product as we have and then we're just getting it out the door," Cleveland said.

About 40% of baby formula products are out of stock nationwide, data firm Datasembly said last week.

Reckitt is prioritizing states that have higher populations of babies who need its products, and low-income mothers who buy formula that is part of the Women, Infants, and Children Nutrition Program (WIC), he added.

It is also making more refill boxes.

Perrigo Co (NYSE:PRGO) Plc, which makes store-brand baby formulas for retailers including Walmart (NYSE:WMT) Inc and Amazon.com Inc (NASDAQ:AMZN), told Reuters last week it expects shortages and heightened demand to last for the "balance of the year."

The U.S. Food & Drug Administration (FDA) on Monday outlined a process by which the agency would not object to the importation of certain infant formula products intended for a foreign market.

U.S. President Joe Biden last week met with executives from infant formula manufacturers and retailers, pressing them to do everything possible to get families access amid a nationwide shortage.

"The White House started asking us if they could work on some of the inputs to our manufacturing process," Cleveland said. Reckitt was at one time struggling to source a plastic mould that helps makes packaging, for instance.

They've been "calling some of these input suppliers to emphasize the urgency and the need to resolve this," he said.

Enfamil maker Reckitt cranks up operations to put baby formula on U.S shelves
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your investing.com profile, will be public on investing.com and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email