US Congress votes to temporarily open up infant formula market

25 Jul 2022 --- US President Biden has signed the Formula Act into law after passing the US Congress and Senate, suspending tariffs on imported infant formulas and making them more affordable for consumers.

NutritionInsight speaks to Congresswoman Susan DelBene, a champion of the bill and Kendal Nutricare, on how industry and consumers will be affected by the new legislation.

The Formula Act has amended the Harmonized Tariff Schedule, chapter 99, subchapter III, to allow infant formula to be imported duty-free until December 31, 2022. The bill is meant to help alleviate the supply shortage of infant formula caused by post-pandemic supply chain problems and the closing of the Abbott plant in Michigan.

“The law can save parents over 25% by allowing safe, foreign formula to be imported duty-free,” says Nick Martin, communications director for Washington state Congresswoman Susan DelBene. “We continue to look at all options to get product back on shelves and make sure families can afford to feed their babies.”

“Common sense”Martin states that the new bill could save US families up to 25% on imported infant formula.
UK-based infant formula company Kendal Nutricare, which has sent millions of bottles worth of their Kendamil infant formulas through Operation Fly Formula hailed the move as a “proactive and progressive step.”

“We see this bill as a proactive and progressive step by the administration and Congress to ease access and affordability of high-quality imported infant formula for US families at a time when they need it most,” underscores Will McMahon, commercial director, Kendal Nutricare. “These changes will help parents make the best choice for their baby based on quality, rather than cost.”

Much of the infant formula that has been imported via Operation Fly Formula come from countries, such as the UK, Germany, Switzerland, Australia and France. This includes milk and goat milk-based products as well as specialized formulas for infants with soy and dairy allergies

“Democrats have taken bold steps to address the formula shortage, but this was a common sense proposal that will be another tool in our belt to help families during this difficult time while our domestic production ramps back up,” highlights Martin.

Some states faring worse than others
Despite steps to tackle the infant formula shortage, the US is still grappling with limited supply.  A statement from DelBene’s office outlines the rate of out-of-stock formulas in the US averaged 31% in mid-April, 45% in mid-May, and 74% at the end of May.

By  the end of May, Washington was one of ten states where the out-of-stock  average was 90% or higher.

“Families across the country – especially in Washington – are driving from store to store searching for food for their babies only to find empty shelves,” DelBene notes.

“Wealthy families could often find ways to import formula, which is typically more expensive, and this law will make it more accessible for middle-class and lower-income families during this extremely challenging time.”

Kendal Nutrition stresses that families can now focus on quality instead of cost.Bipartisan action
The bill was passed unanimously by the Senate, underscoring its importance. However, not all US lawmakers are fully satisfied with the bill. Some, like the bill’s author, Republican Utah Senator Mike Lee, stated that this is only the first step of many. 

In a recent speech Lee gave to the senate he stated that he intends to add many more products to the tariff suspension list. In the speech, Lee said the current crisis is the result of poor governance and needless tariffs that stifle competition. 

Nevertheless, Kendal Nutricare praises the bill’s passing.

“This bill will enable Kendamil to continue to set new standards for quality and value, at a time when other brands are charging families-in-need a significant (and in our view, unwarranted) price premium in this time of hardship,” stresses McMahon.

Though he further notes that Kendamil is: “a new brand for many US families. There remains work to do, in conjunction with the Food and Drug Administration (FDA) and the Department of Health and Human Services, in educating and reassuring parents that Kendamil is fully compliant with all FDA nutritional requirements.”

By William Bradford Nichols