McDonald’s to Resume Full Menu in China Cities This Week

By Bloomberg News

McDonald’s Corp (MCD) is starting to resume its full menu in some Chinese cities, almost two weeks after the fast-food chain pulled items including beef and chicken burgers as its supplier was probed for using expired meat.
Customers in Chinese cities including Beijing and Guangzhou will be able to buy all the items on the menu later this week, Oak Brook, Illinois-based McDonald’s said in a statement today, without specifying the date or number of cities. It’s also increasing orders from other existing suppliers in China while exploring new ones, the maker of the Big Mac burger said.
McDonald’s withdrew beef, pork and chicken items from its restaurants in China after a Shanghai television station reported on July 20 how Shanghai Husi Food Co., a unit of McDonald’s long-term supplier OSI Group LLC, took expired meat and added sell-by dates of another year, renewing fears of food safety in the country.

Aurora, Illinois-based. OSI, which also supplied ingredients to restaurants including Yum! Brands Inc. (YUM) and Papa John’s International Inc (PZZA) in China, has since pulled all products made by Shanghai Husi and replaced its management team in the country after coming under Chinese government investigation. Six executives of Shanghai Husi have been arrested, the state-run Xinhua News Agency reported yesterday, citing Bai Shaokang, vice mayor and head of the public security bureau in Shanghai.

Photographer: Tomohiro Ohsumi/Bloomberg

A customer stands at the counter at a McDonald's Corp. restaurant in Shanghai.... Read More

No Big Macs

The Big Mac wasn’t available in Beijing restaurants, while in Shanghai, limited choices of burgers were being sold, according to McDonald’s delivery services in the two cities.
In Hong Kong, McDonald’s restaurants are serving burgers such as the Big Mac and McChicken burgers “back to their original build,” after lettuce and onion were imported from the U.S. and Taiwan, according to an announcement on the restaurant chain’s website today. McDonald’s Hong Kong halted sales of products supplied by Shanghai Husi late last month.
Chicken McNuggets and items such as fresh corn cups, green salad and fresh lemon tea, whose ingredients were formerly sourced from OSI’s Chinese units in Hebei and Guangzhou, are still unavailable, according to the Hong Kong chain.
McDonald’s is increasing orders from existing suppliers such as McKey Food Services Ltd., a Shenzhen unit of Philadelphia-based Keystone Foods, to handle the shortage of ingredients, the restaurant operator said today. It’s also exploring new Chinese suppliers for items such as fresh produce, and is in the process of evaluating these companies.

Relationship Ended

Yum and Burger King Worldwide Inc. have cut ties with OSI since the food scandal, while McDonald said last month it will continue using food from OSI’s other operations in China.
McDonald’s is China’s second-largest fast-food chain by market share, trailing only Louisville, Kentucky-based Yum, according to London-based research firm Euromonitor International Ltd. Yum, the owner of Pizza Hut, gets about half of its revenue from China.
The latest food safety incident renews Chinese consumers’ fears over unsafe products in the country, following abuses that included fox DNA found in donkey meat and baby formula laced with melamine, a toxic chemical.
China’s leaders have sought to ease those concerns with a new draft law that brings increased scrutiny over the industry, harsher penalties, and more compensation for consumers.