Two-Thirds Of Chinese Consumers No Longer Trust Western Fast-Food As "Meat Scandal" Spreads Across Asia

Tyler Durden's picture




 

As if the Chinese meat scandal was not a big enough concern for Western fast-food firms, The WSJ reports that the crisis is spreading across Asia as Yum Brands and McDonalds sever links with US-owned Shanghai Husi Food Company, which is accused of selling expired beef and chicken, pulling supplies of chicken from restaurants in Japan. Perhaps even more worrisome for American fast-food companies who have expanded aggressively and over-hyped the growth opportunities in China, a second Sina survey started yesterday, featuring 25,000 respondents, found 77% believed the restaurant brands affected had been aware of Husi’s faulty practices, while 69% said they would no longer dine at the restaurants run by the Western companies.

As WSJ reports,

More companies are cutting ties to a U.S.-owned Chinese food supplier over worries that they may have served expired meat to their customers, as they moved to shore up their reputations in a market known for food-safety problems.

 

The issue, which on Monday prompted KFC owner Yum Brands and McDonald's China arm to drop the China-based food supplier, on Tuesday spread to Japan. McDonald's on Tuesday said its outlets there cut ties with Shanghai Husi Food Co., an arm of OSI Group Inc. of Aurora, Ill. Shanghai Husi has been accused in Chinese media reports of selling meat products beyond their shelf life.

 

McDonald's said it pulled chicken nuggets supplied by the company, affecting 10% of its Japanese stores, a move that will create a short-term nugget shortage until new orders arrive from a supplier in Thailand.

 

"In this case we do feel that we were a bit deceived relative to one of these plants," said McDonald's CEO Don Thompson, speaking on the company's earnings conference call on Tuesday.

 

McDonald's, which has more than 2,000 outlets in China, is working with Chinese authorities to investigate, a company spokeswoman said. "It appears from the initial news report that these alleged mis-practices have been hidden from McDonald's," she said.

 

OSI representatives in China didn't respond to requests for comment on Tuesday. On Monday the company said it believed the Chinese media reports depicted an isolated incident, but said it takes full responsibility and would act accordingly.

 

In China, Starbucks, Burger King, and the 7-Eleven convenience store chain and others on Tuesday also said they cut ties with Shanghai Husi.

 

Other food companies that have sourced their meat from Husi include the Swedish furniture retailer, Ikea, and the Chinese fast-food chain, Dicos.

But it appears the damage is done...

A Sina survey started yesterday, featuring 25,000 respondents, found 77% believed the restaurant brands affected had been aware of Husi’s faulty practices, while 69% said they would no longer dine at the restaurants run by the Western companies.

 

...

 

A crisis in confidence in China’s food industry emerged after melamine was found in domestically produced baby formula in 2008. That scandal left 300,000 babies sick and resulted in six premature deaths.

 

Other stories including fake eggs, diseased pork, recycled oil, mislabelled meat have only led to further calls for industry reform.

 

With new food scandals arising every few months on the mainland, Western fast-food brands are generally seen as being more trustworthy than local restaurants.

 

However, this trust may have been badly affected by this new scandal surrounding Husi.

*  *  *
On the bright side, all these firms will have an alternate scapegoat for weak earnings other than the weather...

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Wed, 07/23/2014 - 11:15 | 4992966 Dr. Engali
Dr. Engali's picture

When I think of the McDonalds chain, I usually don't associate the word "food" with it.

Wed, 07/23/2014 - 11:20 | 4993008 101 years and c...
101 years and counting's picture

i blame the fed.  there are massive repercussions for printing money.  

Wed, 07/23/2014 - 11:23 | 4993030 BaBaBouy
BaBaBouy's picture

WOW, It Takes A LOT To Gross-OUT The Chinese, But They Did It!!!

Wed, 07/23/2014 - 11:24 | 4993039 RevRex
RevRex's picture

So who will be the first to blame "the Jews"?

Wed, 07/23/2014 - 11:25 | 4993057 Tabarnaque
Tabarnaque's picture

How Fast Food Providers Beat Inflation - Add Wood Pulp To Burgers

http://www.zerohedge.com/news/2014-07-03/how-fast-food-providers-beat-inflation-add-wood-pulp-burgers

Wed, 07/23/2014 - 11:31 | 4993083 BurningFuld
BurningFuld's picture

The wood pulp would only improve those things.

Wed, 07/23/2014 - 11:36 | 4993116 john39
john39's picture

don't you worry ronald mcdonald... as long as americans have two dollars in their pockets, they will grovel to ingest your soylent brown/wood pulp/gmo goodness, because they know that obamacare will fix them all up when they get tumors growing out every orafice on their bodies...

Wed, 07/23/2014 - 11:44 | 4993166 jbvtme
jbvtme's picture

sir...that rat (cat, frog, dog, lizard, beetle) is it organic?

Wed, 07/23/2014 - 11:48 | 4993174 krispkritter
krispkritter's picture

At least here in America, we'll always have that healthy staple; hot dogs! https://www.youtube.com/watch?v=2NzUm7UEEIY

Wed, 07/23/2014 - 11:58 | 4993262 General Decline
General Decline's picture

Beijing airport. Kenny Roger's Chicken. Creepy.

https://m.flickr.com/#/photos/mattwagers/3715033043/

Wed, 07/23/2014 - 12:03 | 4993293 TeamDepends
TeamDepends's picture

Meanwhile in Obamastan (Michigan), jack-booted federales raid organic farm and force farmers to dump 248 gallons of whole milk and 1200 eggs.  For the children. http://www.theorganicprepper.ca/michigan-dept-of-agri-forces-farmer-to-d...

Wed, 07/23/2014 - 12:50 | 4993630 slyhill
slyhill's picture

fukin sickening

Wed, 07/23/2014 - 12:59 | 4993674 old naughty
old naughty's picture

Fuk-u brought plutonium into the food chain and nowHu-si introduced sick meat?

Asia (Asians) is fuk-hu (same chinese character, meaning fortune or luck).

Fortune, luck ?

Fucked !

Wed, 07/23/2014 - 11:47 | 4993150 HamRove
HamRove's picture

Mmmmm....woodpulp. *drool*

I order mine with extra woodpulp. 

Wed, 07/23/2014 - 11:53 | 4993219 WhyDoesItHurtWh...
WhyDoesItHurtWhen iPee's picture

As an old carpenter, when I ingest wood pulp, I prefer oak sawdust.

Wed, 07/23/2014 - 12:20 | 4993412 youngman
youngman's picture

Cutting fresh pine...I love that smell...better than a new car smell

Wed, 07/23/2014 - 11:51 | 4993204 deKevelioc
deKevelioc's picture

When you write that, sport, you fan the flames of the issue.  You're not too bright; are you?

Wed, 07/23/2014 - 11:51 | 4993214 Zorrohodge
Zorrohodge's picture

I think it was the guy that blamed Greenspan/Bernanke/Yellen for adopting inflationary policies, or it might have been the guy that blamed Strauss neo-conservative attitudes to freemarkets and liberal regulation.

Wed, 07/23/2014 - 11:53 | 4993217 Zorrohodge
Zorrohodge's picture

I think it was the guy that blamed Greenspan/Bernanke/Yellen for adopting inflationary policies, or it might have been the guy that blamed Strauss neo-conservative attitudes to freemarkets and liberal regulation.

Wed, 07/23/2014 - 11:52 | 4993220 Zorrohodge
Zorrohodge's picture

I think it was the guy that blamed Greenspan/Bernanke/Yellen for adopting inflationary policies, or it might have been the guy that blamed Strauss neo-conservative attitudes to freemarkets and liberal regulation.

Wed, 07/23/2014 - 12:11 | 4993354 vulcanraven
vulcanraven's picture

You, apparently

Wed, 07/23/2014 - 12:18 | 4993400 Renewable Life
Renewable Life's picture

Obsess much??

Wed, 07/23/2014 - 12:54 | 4993648 The_Dude
The_Dude's picture

Bad actors beget more bad actors....

Wed, 07/23/2014 - 12:17 | 4993395 Renewable Life
Renewable Life's picture

I wish Americans would do the same!!

Wed, 07/23/2014 - 12:25 | 4993445 Groundhog Day
Groundhog Day's picture

billions and billions served......a heart attack, diabieties, high blood pressure, and lets not forget OBESITY

Wed, 07/23/2014 - 12:49 | 4993623 pods
pods's picture

You know what you get when you eat too much?

Diabeetus.

pods

Wed, 07/23/2014 - 13:07 | 4993720 upWising
upWising's picture

It is said that Chinese diners will eat anything with four legs (except a table) and anything that flies (except an airplane).

Wed, 07/23/2014 - 11:58 | 4993250 deKevelioc
deKevelioc's picture

.

Wed, 07/23/2014 - 11:20 | 4993013 Ignatius
Ignatius's picture

Capitalism and market economy logic, for all its benefits, says that if I can put a turd on a plate, charge $5 and convince you it's dinner, then that's just good business.

Wed, 07/23/2014 - 11:38 | 4993127 Winston Churchill
Winston Churchill's picture

Do you want fries with it ?

Wed, 07/23/2014 - 11:55 | 4993247 Colonel Klink
Colonel Klink's picture

Do you want flies with it?

FIFY

Note:  Works on two levels. ;)

Wed, 07/23/2014 - 12:30 | 4993487 Miffed Microbio...
Miffed Microbiologist's picture

I don't think flies would find McD " food" appetizing. Stick one outside next to one you made at home and do some time lapse photography. That crap Scares even the mold away.

Miffed;-)

Wed, 07/23/2014 - 13:43 | 4993952 WillyGroper
WillyGroper's picture

LOL!

Wed, 07/23/2014 - 11:20 | 4993019 BaBaBouy
BaBaBouy's picture

Oh Well, Back To Cat Chow...

Wed, 07/23/2014 - 11:25 | 4993051 Eirik Magnus Larssen
Eirik Magnus Larssen's picture

Stay away from fast food.

Wed, 07/23/2014 - 11:21 | 4993020 NoDebt
NoDebt's picture

I associate $8/hour jobs, plus HR guidance on how to apply for government assistance programs to supplement that "living wage".

Wed, 07/23/2014 - 11:28 | 4993070 Uncle Remus
Uncle Remus's picture

I don't think they are signatory to the Geneva Convention, so no worries.

Wed, 07/23/2014 - 11:45 | 4993169 Ghordius
Ghordius's picture

China as signed and ratified three out of the five protocols of the Geneva Convention

in contrast, the US has signed four of them... but only ratified two

http://en.wikipedia.org/wiki/List_of_parties_to_the_Geneva_Conventions

Wed, 07/23/2014 - 11:15 | 4992978 RiskyBidness
RiskyBidness's picture

Why dine anywhere other than the well valued Burrito stock that is CMG.  $650 stock price.  Can you say 68x Earinings.  BTFDATH

Wed, 07/23/2014 - 11:16 | 4992984 Magnum
Magnum's picture

Well I've been in Hong Kong for the last three days and what's reported on ZH doesn't match the crowds I've seen at every McDonalds (and there are many here). Maybe the folks here didn't get the memo yet.

Wed, 07/23/2014 - 11:24 | 4993049 slightlyskeptical
slightlyskeptical's picture

30% remainder stills means a whole bunch of Chinese.

Wed, 07/23/2014 - 11:26 | 4993059 Eirik Magnus Larssen
Eirik Magnus Larssen's picture

That or people simply don't care any longer. With the air pollution in China being what it is, it's easy to become jaded over such issues.

Wed, 07/23/2014 - 11:30 | 4993078 Uncle Remus
Uncle Remus's picture

Air you can cut with a butter knife, food not so much.

Wed, 07/23/2014 - 11:27 | 4993060 Dr. Engali
Dr. Engali's picture

What people say they are going to do, and what they actually do has always been two different things. How many millions of pounds of beef recalls have we seen here in the U.S? That hasn't stopped Joe sixpack from taking a big old bite of some sawdust infested pink slime.

Wed, 07/23/2014 - 11:36 | 4993114 dobermangang
dobermangang's picture

It's Whopper Wednesday today.  I'm eating a Whopper.  Yum.

Wed, 07/23/2014 - 11:36 | 4993122 FrankieGoesToHo...
FrankieGoesToHollywood's picture

Every week I swear off McDonalds....

Wed, 07/23/2014 - 11:41 | 4993143 PoliticalRefuge...
PoliticalRefugeefromCalif.'s picture

..MacDonalds is a happy place... a clean and happy place.. a snap snap snappy place..

my  how the times have changed.

Wed, 07/23/2014 - 11:58 | 4993263 boattrash
boattrash's picture

Seems nobody is seeing the upside. Food Prices in US will drop as our supermarkets are flooded with this crap.

Wed, 07/23/2014 - 13:24 | 4993817 fallout11
fallout11's picture

Our supermarkets are already flooded with this crap (from GMO-ed  frankenveggies to hormone-laced vat grown shmeat), shrinking package sizes, and prices are still up. "Real" food now costs x5 as much as 10 years ago.

Wed, 07/23/2014 - 12:34 | 4993511 Blackfox
Blackfox's picture

When we had the horsemeat scandal in the UK, people said they was going to boycott all the big supermarkets. 2 weeks later everything was back to 'normal'.

The sheeple don't give a fuck.

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