Tornado damage could affect baby formula supplies, Reckitt says

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Baby formula maker Reckitt said supplies of some of its nutrition products are likely to be affected by a tornado that damaged one of its warehouses in Mount Vernon, Indiana. Reckitt, a British consumer goods company, owns Mead Johnson Nutrition, the maker of Enfamil baby formula products. Reckitt on Wednesday said that the tornado, which struck on July 9, caused "significant damage" to the warehouse, which the company called "an important site for the Mead Johnson Nutrition business." The facility, which is operated by a contractor, houses both raw materials and finished products. A cluster of at least four tornadoes whipped up by the remnants of Hurricane Beryl barreled through Indiana's southwestern corner, with winds up to 140 mph. The twister that hit Mount Vernon and other parts of Posey County grew to about 300 yards wide and left a trail of damage nearly six miles long, collapsing much of a warehouse, derailing train cars, damaging mobile homes and ripping roofs off homes. While Reckitt said that it regained access to the warehouse on July 13, the facility is not yet operational. In the meantime, all inbound deliveries have been diverted to other warehouses in the U.S., the company said. That could mean temporary shortages of some of its baby formula products in the near future. Mead Johnson told CBS MoneyWatch that supplies of some of its nutrition products "will likely be affected in the short term." "We are partnering with customers and suppliers on expedited recovery efforts to minimize disruption by leveraging our global supply chain and managing inventory at our other U.S. warehouses," Mead Johnson added in a statement. Reckitt is still assessing the damage to the warehouse and said it would provide on update on its quarterly earnings call on July 24. Reckitt also said the weather event will affect the company's short-term sales. The company is "working closely with all our stakeholders including customers and suppliers, to minimize disruption, by leveraging our global supply chain and managing inventory at our other North American Nutrition warehouses and held by our retail partners," the company said. Reckitt added that it expects its property damage and business interruption insurance policies to mitigate the impact of the temporary facility closure on company earnings. Parents and caregivers around the U.S. faced a severe shortage of infant formula in 2022 as the pandemic disrupted global supply chains. Compounding the problem was the closure of a Sturgis, Michigan, plant operated by Abbott Nutrition, a major manufacturer of baby nutrition products, because of bacterial infections.