China food scandal: McDonald's Japan to strengthen checks on chicken

TOKYO - McDonald's (MCD) in Japan is increasing its checks on chicken from suppliers in China and Thailand after allegations a Chinese supplier sold expired chicken. It says the scare will hurt its earnings.

The U.S. fast-food chain's Japan unit on Tuesday withdrew this year's earnings and sales forecasts, citing uncertainties from the food scandal.

It promised to disclose information online about where its food comes from.

It said it will strengthen safety checks on suppliers it's still using in China, for apple pie, muffins and cookies, as well as its Thai chicken supplier.

Such checks will be extended to food items in Japan, the company said.

The Chinese food safety agency is investigating news reports that allege that Shanghai Husi Food Co., a McDonald's supplier, sold expired meat. McDonald's Japan has stopped using chicken from Husi, which is owned by the Illinois-based OSI Group.

On Sunday, OSI announced it was withdrawing all products made by Husi in Shanghai. It was unclear whether any still were in use after major fast food outlets suspended use of Husi's products following last week's news report.

On its website, David McDonald, OSI's president and chief operating officer, released a statement saying, "We as a company sincerely apologize for this unfortunate event. We are moving as quickly as possible to address specific and more general identified shortcomings."

The statement went on to outline changes the company is making to its China operations.