Abbott Nutrition has announced plans to build a $500 million nutrition facility in the US for speciality and metabolic infant formulas.

On a call with investors, Abbott’s chairman and CEO, Robert Ford, said: “We conducted an analysis of the US infant formula market and concluded that this country would benefit from more manufacturing capacity and redundancy. As such, we are moving forward with plans for a half-billion-dollar investment in a new US nutrition facility for speciality and metabolic infant formulas.”

Ford added that the company is currently in the final stages of determining the site’s location.

The news comes amid continued shortages in the US baby formula market. Inflation and the Covid-19 pandemic had already put pressure on supply chains when an Abbott plant in Sturgis, Michigan, was temporarily shut down over contamination concerns in February and a number of infant formula products were recalled.

In the investor call, Ford also gave an updat on the Sturgis site: “We restarted production at Sturgis in July with a focus on our EleCare and other speciality infant formulas. And in September, we began production of several Similac products, which we expect will begin to reach retail store shelves over the coming weeks.”

He added: “We also boosted production in our global network to increase infant formula supply to the US. In fact, we delivered roughly the same volume of formula to our US customers this past quarter as we did during the three months prior to the recall.”

“Our number one supply priority was to the WIC – women, infant and children – federal food assistance programme to ensure that underserved participants would have access to infant formula.”