The following is a response from McDonald's to a letter written by Donald Patman, President of the Texas Farm Bureau. That letter was in regards to the fast food giant's decision to pilot test imported beef for use in their products. The letter urged that McDonald's make the purchase of U.S. beef a priority and exhaust sources of supply within the U.S. before any import suppliers were considered. McDonald's response reads as follows:

Dear Mr. Patman:

Thank you for your letter to Jack Greenburg. On behalf of Jack, I wanted to respond to your concerns and ensure you have the facts. I'd encourage you to share this letter with others who share your concerns.

First, we'd like to reiterate our long-term commitment to the U.S. agriculture industry. McDonald's buys almost 1 billion pounds of beef from U.S. producers each year—thus making us the largest purchaser of U.S. beef. That's not all. McDonald's also purchases 500 million pounds of chicken each year; 156 million dozen eggs; and 60 million gallons of milk. In no way whatsoever will we ever lessen our dependence on the U.S. farmer. In fact, we are aggressively working with farmers and ranchers, on a state and national level, to strengthen our relationship.

With that said, there is a well-documented shortage of lean beef in the U.S. because of the declining number of breeding and dairy cows going to market. These animals are a significant source of lean ground beef. At the same time, consumer demand for ground products is increasing dramatically; ground beef now accounts for nearly 50 percent of total red meat consumption, and lean ground beef is clearly preferred by the retail customer. That's the reason McDonald's is conducting a small test in the Southeast U.S. In the test, McDonald's is only supplementing dwindling supplies of U.S. lean grinding beef with a small supply of beef from Australia and New Zealand.

Even so, the vast majority of every hamburger, even in the Southeast, is made with U.S. beef, as this small McDonald's test involves less than 1 percent of the beef we sell in restaurants. Meanwhile, all national hamburger chains have used or are using a significant percentage of imported beef; as much as 50 percent of their beef is imported.

You should also know we're working with the National Cattlemens' Beef Association (NCBA) to explore other solutions to the lean beef shortage, including looking at muscle profiling and other grades of cows. We are committed to working with the industry to address the challenges that we both face in this competitive and dynamic marketplace. In fact, we're asking the entire Quick Service Restaurant (QSR) industry to commit to working with the American producer to increase the domestic supply of lean grinding beef.

One additional point you may not be aware of: the amount of beef that enters the U.S. is governed by a strict quota system. Whether McDonald's uses imported beef or not, the same amount of beef will be imported. We committed to the industry—and remain steadfast—that we advocate keeping this quota the same.

It's also important to point out we're aggressively expanding the export market. Beef from our cattle producing states supplies both fed trimmings and finished hamburgers to growing McDonald's markets in Latin America and the Caribbean; last year alone, we exported 19 million pounds of meat to those markets. We're committed to working with the NCBA and other agriculture groups to identify ways in which we can further expand our global use of beef from U.S. cattle.

In closing, we'd like to reiterate that McDonald's only uses those products that meet or exceeds the highest standards. Imported beef must meet the same requirements as the products produced domestically including our requirements for feed certification and animal welfare. Our stringent specifications are the reason McDonald's is known worldwide for consistency and quality.

Please let me know if you have any further questions.

Sincerely,

Frank Muschetto
Sr. Vice President McDonald's Supply Chain Management

Mike Thompson

Vice President McDonald's US Supply System