Nestle Expands Infant Formula Recall to China and Brazil

• No illnesses have been confirmed yet, and the recall is described as preventative after the toxin was detected in products originating from manufacturing sites in the Netherlands and Switzerland
• The contamination stems from a quality issue in arachidonic acid oil from a leading supplier; Nestle is now activating alternative suppliers to maintain production
• The crisis adds pressure on new CEO Philipp Navratil who is working to revive growth at the company behind KitKat and Nescafe brands

Nestle Expands Infant Formula Recall to China and Brazil

Summary:

Nestlé has significantly expanded its infant formula recall to include markets across the Americas and Asia, affecting at least 37 countries including China, Brazil, Mexico, Australia, and most European states. The recall involves several product lines—SMA, BEBA, NAN, and Alfamino—due to possible contamination with cereulide, a toxin that can cause nausea and vomiting. No confirmed illnesses have been reported to date.

Austria's health ministry characterized this as potentially the largest recall in Nestlé's history, affecting more than 800 products from over 10 factories, though the company has not verified this claim. The contamination was detected in arachidonic acid oil from a leading supplier used in production.

Brazil's health ministry stated the recall is preventative after toxin detection in products originating from the Netherlands. Products recalled in Australia were manufactured in Switzerland, while China's affected batches were imported from Europe, indicating the recall's broad geographic manufacturing scope.

Nestlé has tested all arachidonic acid oil and corresponding oil mixes used in production and is now ramping up manufacturing while activating alternative suppliers to maintain supply continuity.

Market Implications:

This crisis adds significant pressure on new CEO Philipp Navratil, who is attempting to revive growth at the KitKat and Nescafe maker. The recall's unprecedented scale across Nestlé's infant nutrition portfolio could impact consumer trust, market share, and financial performance in a critical product category. The company faces potential regulatory scrutiny, supply chain challenges, and reputational damage during a crucial period of strategic transformation.