Baby formula shortage is getting worse: 40% of the top-selling products out of stock

Baby formula is getting even harder to come by at retailers across the US, amid a nationwide shortage of one of the most important products for new parents.

At retailers across the US, 40% of the top-selling baby formula products were out of stock as of the week ending April 24, a new analysis from Datasembly, which tracked baby formula stock at more than 11,000 stores, shows. National out-of-stock levels jumped nine percentage points, from 31% to 40% between April 3 and April 24. That’s up sharply from 11% in November.

“This is a shocking number that you don’t see for other categories,” Ben Reich, CEO of Datasembly told CBS MoneyWatch.

The supply of baby formula was already so constrained that retailers have been limiting the number of products consumers are allowed to purchase in order to preserve their inventories.

Rationing at stores

Drugstore chains Walgreens and CVS Health, and department store Target in April put limits on how many baby formula products consumers can purchase at one time.

A spokesperson for Walgreens told CBS MoneyWatch it is limiting customers to three infant and toddler formula products per transaction, citing “increased demand and various supplier issues.”

CVS Health also said it has imposed a limit of three baby formula products per purchase in stores and online, until it can procure sufficient supply from its vendors.

And a spokesperson for Target confirmed it has product limitations in place. At Target.com, consumers can only purchase up to four pieces of a given baby formula product at a time.

Prices of baby formula, which three-quarters of babies in the US receive within their first six months, have also spiked. The average cost of the most popular baby formula products is up as much as 18% over the last 12 months.

Supply-chain snarls related to COVID-19 are contributing to the shortage of formula around the US They include manufacturers having more difficulty procuring key ingredients, packaging hangups and labor shortages, with those factors combining to affect production and distribution. In addition, to major baby formula recall in January exacerbated shortages.

“We’ve been tracking it over time and it’s going up dramatically. We see this category is being affected by economic conditions more dramatically than others,” Reich added.

In six US states, more than 50% of formula was out of stock as of late April. Parents in Iowa, South Dakota, and North Dakota are grappling with severe shortages of 50%-51%, according to Datasembly. Out-of-stock levels are even higher in Missouri (52%), Texas (53%), and Tennessee (54%). At the same time, between 40%-50% of baby formula products were out of stock in 26 states.

“We’ve noticed it being difficult to find maybe a couple months ago — two, three months ago — and then just recently we can’t find it,” San Francisco resident Irene Anhoeck told CBS News earlier this year. “We’ve tried all the local Targets. We checked Costco, Costco online, Walgreens, Long’s. Can’t find it anywhere.”

Product shortages were further exacerbated in February, when Abbott Nutrition issued a widespread recall of its powdered baby formula products, following reports of illness among infants who had consumed the baby products. The US Food and Drug Administration last week issued a warning telling consumers not to use any of the recalled products manufactured at Abbott Nutrition’s Sturgis, Michigan, facility, after it found the plant to be unsanitary.

Avoid hoarding

The Infant Nutrition Council of America recently assured parents in a statement on its website that manufacturers are increasing production to meet families’ needs. The council also encourages parents to keep a 10-day to two-week supply or formula at home, while urging them not to stockpile products.

A spokesperson for CVS Health acknowledged that “product supply challenges are currently impacting most of the retail industry.” The company is working with “national brand baby formula vendors to address this issue and we regret any inconvenience that our customers may be experiencing,” the spokesperson added.

In January, Enfamil, a leading baby formula brand, said it was coping with an unprecedented 18% surge in demand for baby formula nationwide.

“We have taken steps to ramp up production and are currently shipping 50% more product, to address issues as fast as possible,” a spokesperson for Reckitt, maker of Enfamil, told CBS News in a statement at the time.

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