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Wednesday, March 4, 2015

Singapore Straits Times- McDonalds to Use "Healthier" Chicken, Other Meal Components

Thursday, Mar 5, 2015
 World
 
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Plan by McDonald's to use antibiotic-free chicken could prompt supply squeeze in the US

PUBLISHED ON MAR 5, 2015 10:45 AM 
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Chickens look out of a cage at a hatchery in Mangaon, south of Mumbai on Feb 2, 2015. McDonald's plans to phase out chicken raised with certain kinds of antibiotics at its 14,000 United States restaurants. -- PHOTO: REUTERS 
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NEW YORK (Reuters) - A plan by McDonald's to phase out chicken raised with certain kinds of antibiotics at its 14,000 United States restaurants will put additional pressure on an already-stressed supply chain.
Antibiotic-free chicken currently accounts for a tiny portion of total US supplies, and an increasing desire on the part of consumers for more "natural" products has meant that demand sometimes exceeds supply.
Available product has been so tight that when six of the largest US school districts tried to make the switch to antibiotic-free poultry last year, chicken sellers such as Tyson Foods and Pilgrim's Pride Corp said they could not change their production systems quickly enough to meet the demand.
The decision by the world's biggest restaurant chain to jump into the fray seems likely to complicate things further, tightening supply and thereby raising prices, said Athlos Research principal Jonathan Feeney. "This is very likely to cause a disruption in McDonald's food supply and will likely raise operating costs for McDonald's franchisees," added Mr Richard Adams, a former McDonald's franchisee who now runs the consulting firm Franchise Equity Group.
 
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