# Exclusive-Danone ramps up U.S. baby formula shipments to address shortage
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2022-05-20
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: Danone Increases Infant Formula Shipments Amid U.S. Shortage
Meta Description: Danone SA ramps up ocean imports of infant formula to the United States following a recall by Abbott Laboratories, ensuring families have access to vital
URL: https://financedigest.com/exclusive-danone-ramps-up-u-s-baby-formula-shipments-to-address-shortagehtml

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By Richa Naidu and Lisa Baertlein

LONDON/LOS ANGELES (Reuters) – Aptamil maker Danone SA has stepped up shipments of infant formula from Europe to address a shortage in the United States, according to U.S customs data and an analysis of ocean cargo data by shipping consultancy Ocean Audit for Reuters.

Danone, the [world’s second biggest](https://www.financedigest.com/biggest-economy-in-the-world.html "Biggest Economy in the World") baby milk formula maker but a relatively small player in the United States, shipped much of the product from Britain and the Netherlands by ocean freight through its Nutricia North America arm.

This followed a Feb. 17 recall by top manufacturer Abbott Laboratories which recalled dozens of types of its Similac, Alimentum and EleCare formulas, creating one of the most urgent [food shortages](https://www.financedigest.com/we-are-going-to-die-food-shortages-add-to-sri-lankas-woes.html "‘We are going to die’: Food shortages add to Sri Lanka’s woes") in recent history for U.S. families.

Between January and May, Danone’s Nutricia division more than tripled its ocean imports to [North America](https://www.financedigest.com/north-america-to-emerge-as-largest-market-for-softball-equipment-through-2026.html "North America to Emerge as Largest Market for Softball Equipment Through 2026"), and more than 90% was delivered to the United States, said Steve Ferreira, CEO of Ocean Audit, which analysed the data exclusively for Reuters.

We understand how [important it is for families to access these specialized formulas which is why our absolute priority has been to increase production and supply of these medical formulas to serve the most vulnerable babies since](https://www.financedigest.com/eu-u-s-step-up-russian-aluminium-nickel-imports-since-ukraine-war.html "EU, U.S. step up Russian aluminium, nickel imports since Ukraine war") the shortages arose in February,” a Danone spokesperson told Reuters.

On May 10, three days before U.S. President Joe Biden took to the airwaves with his [plan for addressing the baby formula](https://www.financedigest.com/motor-racing-porsches-formula-one-plans-stall-as-red-bull-talks-collapse.html "Motor racing-Porsche’s Formula One plans stall as Red Bull talks collapse") shortage, the Independent Quest sailed into the Port of Philadelphia to deliver 42,000 cans of Danone formula.

It was rapidly dispatched to Jeffersonville, Indiana to be distributed to retailers that for weeks had to limit how much [infant formula](https://www.financedigest.com/reckitt-expects-u-s-infant-formula-shortage-until-spring.html "Reckitt expects U.S. infant formula shortage until spring") mothers could buy.

“If it comes into the port on a Monday, I’m almost certain that they would have it out by Tuesday or Wednesday because the product’s so hot,” Ferreira said.

Ferreira said his data showed that from Jan. 1 to May 1 2021 Danone Nutricia sent nearly 770,000 cans of infant formula, filling roughly 100 cargo containers, to the [North America](https://www.financedigest.com/precise-remote-monitoring-to-steal-the-north-america-medical-wellness-devices-market.html "Precise Remote Monitoring to steal the North America Medical Wellness Devices Market"). During the [comparable period this year](https://www.financedigest.com/glastons-interim-report-1-january-31-march-2018-orders-received-grew-23-comparable-operating-profit-at-previous-years-level.html "Glaston’s Interim Report 1 January – 31 March 2018: Orders received grew 23%, comparable operating profit at previous year’s level"), the number skyrocketed to more than 2.4 million cans, he said.

Of that product, 93% went to East Coast U.S. ports, while 7% went to ocean gateways in Mexico, Ferreira said.

Separate U.S. [customs data](https://www.financedigest.com/why-now-is-the-time-for-banks-to-use-their-data-to-support-customers.html "Why now is the time for banks to use their data to support customers") analyzed by Reuters shows that on Feb. 22, five days after the Abbott recall, nearly 38,000 kilograms (83,775.66 pounds) of Danone Nutricia cargo [arrived in the United States from Britain](https://www.financedigest.com/britains-prince-harry-arrives-at-balmoral-itv-reporter.html "Britain’s Prince Harry arrives at Balmoral – ITV reporter") and the Netherlands.

The customs data did not specify the exact nature of the cargo, but described some of it as [“clinical nutrition](https://www.financedigest.com/the-infant-clinical-nutrition-market-to-be-on-the-mobility-move.html "The Infant Clinical Nutrition Market To Be On The Mobility Move") powder” and “medical nutrition. On March 9, roughly 34,000 kilograms more arrived, followed by nearly 30,000 kilograms on March 30.

Reuters could not obtain [records confirming Danone’s airborne baby formula](https://www.financedigest.com/mena-infant-milk-formula-market-to-record-exponential-compound-annual-growth-rate-in-the-coming-years.html "Mena Infant Milk Formula Market to Record Exponential Compound Annual Growth Rate in the Coming Years") imports.

Danone’s [shares were up 1.6% in early afternooon trade](https://www.financedigest.com/russian-central-bank-gives-legal-entities-green-light-to-trade-foreign-shares.html "Russian central bank gives legal entities green light to trade foreign shares") on Paris’ blue-chip CAC 40 index.

FORMULA SHAKE-UP

The deliveries show how the suspension of Abbott’s factory and shortages are shaking up the market, giving some players an opportunity to get a [share of the lucrative $4.8 billion](https://www.financedigest.com/abb-to-launch-1-billion-share-buyback-on-april-3.html "ABB to launch billion share buyback on April 3") U.S. baby formula industry.

Abbott looks to have lost around 2000 basis points of share, going from 40% [share to 20%,”](https://www.financedigest.com/ubisoft-shares-slump-20-after-french-video-game-maker-warns-on-revenue.html "Ubisoft shares slump 20% after French video game maker warns on revenue") Barclays analyst Warren Ackerman estimated on Friday referring to the U.S. market.

Reckitt Benckiser, the long-time No.2 [player in the United](https://www.financedigest.com/high-energy-shockwave-therapy-units-market-end-user-demand-by-types-regions-top-players-service-provides-regional-outlook-and-forecast-to-2028.html "High Energy Shockwave Therapy Units Market End-User Demand by Types, Regions, Top Players, Service Provides, Regional Outlook and Forecast to 2028") States, told Reuters on Tuesday that it now accounts for more than 50% of total baby formula supply in the country.

The [British company said it supplied](https://www.financedigest.com/fuel-pumps-run-dry-in-british-cities-sowing-supply-chain-chaos.html "Fuel pumps run dry in British cities, sowing supply chain chaos") just over a third of U.S. baby formula prior to Abbott’s recall.

It has [boosted Enfamil production by about 30% and is making more frequent deliveries to stores](https://www.financedigest.com/ikea-stores-owner-ingka-says-campaigns-help-boost-store-visits-and-sales.html "IKEA stores owner Ingka says campaigns help boost store visits and sales") as it looks to counter a nationwide shortage in U.S. supermarkets.

(Reporting by Richa Naidu in London and Lisa Baertlein in [Los Angeles; Editing by David Gregorio in New York, Josephine Mason and Alexander Smith in London)](https://www.financedigest.com/patsnap-circumnavigates-northern-hemisphere-with-launch-of-los-angeles-office.html "PatSnap circumnavigates northern hemisphere with launch of Los Angeles office")


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