OSI is Chipotle’s major meat supplier
OSI outraged, apologetic on China chicken processing scandal
By Rita Jane Gabbett on 7/21/2014
Aurora, Ill.-based OSI Group issued a statement saying it is investigating a story on Chinese television by a reporter who went undercover for two months at OSI-owned Shanghai Husi Food Co. Ltd., revealing expired meat being used to make products typically sold to McDonalds and Yum Brand’s KFC restaurants in China.
“Company management was appalled by the report and is dealing with the issue directly and quickly. The company has formed an investigation team, is fully cooperating with inspections being conducted by relevant, supervising government agencies and is also conducting its own internal review,” an OSI statement read. “The company is committed to sharing the investigation results with the public and taking all necessary action based on those results.”
According to CNBC, the Dragon TV report showed a batch of chicken breast and chicken skin that had been expired for around 12 days at the time of the filming. The reporter asked, "Is it OK to use them?" and the answer was "no problem." The chicken was turned into chicken nuggets.
McDonald’s and KFC-parent Yum apologized to customers and stopped serving products purchased from the supplier on Monday after Chinese regulators shut down the Shanghai Husi plant following the TV report, according to Reuters.
A McDonald’s spokeswoman told Meatingplace the scandal affects about one quarter of its approximately 2,000 restaurants in China.
“We are committed to the highest standards of food safety and our customers are always our number one priority,” McDonald’s Director of Global Media Relations Becca Hary said in an email. “If confirmed, the practices outlined in the report are completely unacceptable to McDonald’s. We are no longer serving product from the facility.”
The scandal is a blow to both chains, which are heavily invested in China. Both suffered last year from avian bird flu concerns and in 2012 from concerns about hormone use in chicken products in China.
Just last week, Yum Brands reported earnings boosted by its operations in China. Same-store sales in Yum’s China division jumped 15 percent as demand recovered from last year’s avian flu scare. At KFC China alone, same-store sales were up 21 percent. The China division contributed more than one-third of Yum’s total operating profit in 2013.