McDonald's Japan Rations Fries as U.S. Port Labor Dispute Continues

McDonald's Holdings Co (Japan) Ltd has embarked on the emergency measure of only offering small-sized french fries to customers as a protracted labour dispute at U.S. West Coast ports has contributed to long delays in imports.

The fast-food chain said it was importing more than 1,000 tonnes of frozen fries by air, which began arriving last Monday and had begun routing another 1,600 tonnes through ports on the U.S. East Coast which should begin arriving in late January.

Those steps alone, however, are not sufficient to prevent a shortage.

"Unfortunately without this sales restriction step, we would run the danger of running out of fries at some of our stores around the end of the year or beginning of the new year," said McDonald's Japan spokeswoman Kokoro Toyama.

Toyama said the company, which has 3,100 stores in Japan, was not placing any limit on the number of small-sized fries a customer may buy but the resumption of medium-sized and large-sized fries remains unclear. She declined to comment on the impact on earnings.

Container ports along the U.S. West Coast have been experiencing severe delays since October, in part due to lengthy labour talks between 20,000 dockworkers and the Pacific Maritime Association, representing terminal operators and shipping lines at 29 West Coast ports.

A shortage of tractor-trailer chassis used for hauling cargo from the ports to warehouses, record levels of imports into the United States, rail service delays and the advent of super-sized container vessels delivering greater cargo volumes have also contributed to the problem.

Japan is the biggest Asian market for U.S.-made frozen potato products, importing $336 million worth last year. A U.S. Potato Board official said last week that said port jams have at least doubled transit times for shipments of french fries to Japan from two to four weeks.

Reporting by Edwina Gibbs