Imported baby formula is again be subject to tariffs in 2023.

Last summer, Congress voted to temporarily suspend tariffs on some imported infant formula products during a national shortage. Parents and guardians were struggling to find formula due to supply chain disruptions, a recall by manufacturer Abbott Laboratories and the closure of a major formula factory.

The temporary tariff exemption was set to expire on Dec. 31, meaning in January, imports will again be subject to tariffs, which can be as high as 17.5%.

Lawmakers and dairy industry leaders are trying to understand what went wrong and how to prevent a future shortage.

The availability of powdered baby formula in U.S. stores has recently improved. Out-of-stock levels fell from 30% in July to 25% in August and to 14% in October, according to market research firm IRI.

Some families, however, still report shortages. Adults in 33.9% of households with infants who use formula said they had difficulty getting formula between Nov. 2 and 14, according to the latest Household Pulse Survey from the U.S. Census Bureau.

Some groups have urged Congress to extend the waivers; others say it’s time to reinstate tariffs.

Leaders in the U.S. dairy industry, which produces milk and powder for baby formula, say supplies have improved and lawmakers should let the tariff suspensions expire as planned.

In a Nov. 17 letter to lawmakers, Jim Mulhern, chairman and CEO of the National Milk Producers Federation, or NMPF, wrote that his organization supported the temporary suspension but the crisis is now past.

“We respectfully request your opposition to any effort to extend these preferential tariff benefits beyond the end of the year,” wrote Mulhern.

On Dec. 29, NMPF’s executive vice president of policy, Jaime Castaneda, reiterated Mulhern’s message.

“We were very supportive of lifting any obstacles to have the formulas coming in from overseas during the crisis. We don’t have that crisis anymore,” he said.

Now, NMPF is strategizing how to prevent a shortage from occurring again.

Castaneda said having a larger volume of domestically produced baby formula could help ensure stability. The problem, he said, is that the U.S. has stringent regulations on what is required to build and operate a formula plant, making it more difficult for American companies to produce formula than companies in many other countries.

If regulations were less onerous, he said, the U.S. could produce a higher volume, exporting the surplus and having a backup supply. Castaneda said this might also provide dairy farmers with additional income.

Lawmakers have similarly been exploring how to prevent a future crisis.

Some legislators have raised red flags over market consolidation.

Pre-recall, Abbott Laboratories controlled about 40% of the U.S. infant formula market. Some lawmakers are concerned that a few big players make the majority of domestic formula.

Lawmakers have also asked what role the Special Supplemental Nutrition Program for Women, Infants and Children, or WIC, may have played in prompting consolidation. Half to two-thirds of infant formula sold in the U.S. is bought through WIC, which uses sole-source contracting, which favors a few large companies.

Policy experts anticipate the debate will continue in the 118th Congress.