Supply chain crisis complicates fixing baby formula shortage, expert says

The critical shortage of baby formula across the United States is being exacerbated by many of the same issues implicated in the global supply chain crisis borne by the Coronavirus pandemic, says a Virginia Tech industrial packaging and shipping expert.

"The challenge with any major change—such as increasing the production of baby formula—is that the supply chain is already strained," said Lazlo Horvath, director of Virginia Tech's Center for Packaging and Unit Load Design.

"It is also hard to get any trucks on the road because shipping companies are running at full capacity, too," Horvath said, noting that his team is engaged with a key company in the warehouse rental space who reports most of its market already fully saturated.

Thus even ramping up production of infant formula—which key companies say they're doing —may not immediately help, because there are fewer companies making the right packaging to store components, fewer available warehouses to store products, and fewer trucks to ship it all.

"These problems are on top of the complications brought on by getting more materials to produce the product, and the canisters that are needed to put the baby food into it," Horvath said. "Companies are barely able to ramp up their production to 100 percent because some of the required materials are always missing."

Though not familiar with the current availability of baby food containers, Horvath said "most industrial plastic packaging production companies are running at 100% capacity—thus getting time on any of the equipment to produce something new is hard."

He said the same is true for items that ship on wooden pallets, which represents a large section of consumer supply chains.

"A lot of companies are expanding their production, but due to labor constraints, pallet companies are serving current customers first," he said. "Some of them cannot even take new customers."