Tainted Formula Crisis Deepens to Include Danone, Lactalis
(Bloomberg) — A tainted infant formula crisis that started with Nestlé SA is deepening globally with French manufacturers Danone SA and Groupe Lactalis pulling products potentially contaminated with a toxin.
Lactalis has recalled six batches of Picot brand infant formula in France, Agence France-Presse reported, an issue related to an international supplier that affects 18 countries including Spain. A Danone formula product was also pulled from shelves in Singapore.
Danone confirmed that it had removed one of its Dumex Dulac products at the request of Singapore’s food safety regulator, prompting the stock to plunge the most in more than three decades. The Singapore Food Agency also instructed local manufacturer SMC Nutrition to stop exporting some products that used the same ingredient.
Danone shares fell as much as 12% in Paris trading on Wednesday on the news before regaining ground. Nestlé is down more than 4% since the recall began.
Singapore’s food agency had already previously recalled five Nestlé products after the Swiss food group disclosed that several brands, including BEBA, SMA and Alfamino, and multiple production sites had been affected by the discovery of cereulide in arachidonic acid oil, an ingredient from one of its suppliers.
News that the contamination crisis is potentially spreading is a worrisome development for a highly regulated food product that millions of parents rely on globally.
Danone said that it blocked a batch of product specifically manufactured for Singapore at the request of the authorities there. It said it had detected no issue with cereulide in any of its brands and reiterated that it follows strict food safety and quality standards, with all products undergoing rigorous testing before leaving factories.
Nestlé is currently the most affected manufacturer with products pulled from shelves in more than 60 countries worldwide. French authorities are currently probing the death of an infant there to see if there is any link to recalled products. Anti-poison centers in France have been contacted by parents whose infants are showing symptoms including vomiting and diarrhea, the authorities said.
A public health agency in Brazil has also said that two babies were ill, potentially caused by Nestlé formula.
Facing Questions
Nestlé, where Philipp Navratil took over as chief executive officer in September, said it’s not aware of an investigation in France and is in contact with health authorities in Brazil to obtain more details on the reports of ill babies. Clinical evidence is needed to definitively prove a sickness has been caused by the consumption of a food product, it said.
“We reiterate that the safety of our products and wellbeing of infants remain our top priority,” it said.
Determining whether cereulide is to blame for poisoning is often difficult, said Monika Ehling-Schulz of the University of Veterinary Medicine Vienna, who co-developed the standard test for the toxin. Investigators are most certain when cereulide is detected in both the infant and the product, but that is not always possible, particularly with powdered formula that can be contaminated during preparation.
“This case is turning into a nightmare for the new leadership team at Nestlé and appears largely out of control at this stage,” said Jean-Philippe Bertschy, an analyst at Vontobel.
The company is “backed into a corner” and will likely face questions about quality control standards and the level of investment in production sites in recent years as the group has cut costs, according to Bertschy. It’s clear, he said, that Nestlé isn’t the only company affected as “other Swiss and global manufacturers that use this ingredient are also concerned.”
Dumex is largely irrelevant for Danone but the recall in Singapore raises the possibility that the supplier of arachidonic acid oil used by Nestlé served others, according to Kepler Cheuvreux analyst Jon Cox. He pointed to Hochdorf Swiss Nutrition, which recalled some Bimbosan goat milk batches amid contamination with the same toxin.
Lactalis didn’t immediately respond to an emailed request for comment. SMC Nutrition declined to comment.
–With assistance from Karoline Kan, Joe Easton, James Regan and Michael Msika.
©2026 Bloomberg L.P.
