McDonald's Stock Dips Amid Packaging Policy Reversal and Price Hikes in Japan

Recently, McDonald's has decided to switch back to reusable plastic containers for dine-in packaging, influenced by the policy shift under Trump's administration. This move reverses the chain's previous efforts toward sustainability, which involved transitioning to paper-based packaging since 2007.

McDonald's global packaging transition began with replacing plastic bags with paper bags in 2007, swapping plastic cups for paper ones in 2010, and the introduction of paper straws in 2020. These changes positioned McDonald's as a leader in environmentally friendly practices, setting a benchmark in the industry.

The change in policy comes at a time when global anti-plastic sentiment has been gaining momentum. In response, the Chinese paper industry has significantly ramped up its capacity for producing food-grade paper, adding over 1.3 million tons in recent years. However, with McDonald's shift back to plastic packaging, the paper industry faces potential overproduction and market adjustments.

In Japan, McDonald's has announced price increases for menu items due to rising costs in energy, logistics, and labor. Effective March 12, items like hamburgers, McNuggets, and drinks will see a price adjustment. This reflects wider economic pressures, including Japan's increasing food import costs driven by a weakened yen and volatile global conditions.

Furthermore, McDonald’s is revamping its organizational structure to enhance the introduction of new products and technology in restaurants. Jill McDonald will become the first Chief Restaurant Experience Officer, overseeing operations, supply chain, franchise, development, and innovation labs. The company has also set ambitions to expand its global presence to 50,000 restaurants by 2027.