China’s Shanghai Food and Drug Administration contends that Yum Brands’ KFC chain in China was supplied with chicken that contained excessive amounts of antibiotics. Reuters reports that eight of the 19 batches of chicken samples Yum Brands sent to a testing laboratory in 2010 and 2011 contained overly high levels of antibiotics, the SFDA said in a statement on its Website late on Thursday.
An investigation is underway to determine if Yum Brands had taken corrective measures at the time, and the company can face harsh penalties if the probe shows laws had been violated, stated the SFDA. Yum Brands issued a statement saying that it was cooperating with the Chinese government’s review of two poultry suppliers who provided chicken with unapproved levels of antibiotics. The company said those suppliers "represent an extremely small percentage of product to KFC."
Shares in Yum Brands have slumped 4 percent since December 18 when China's state television CCTV reported that some poultry suppliers in eastern Shandong province had fed chickens with anti-viral drugs and hormones to accelerate their growth.
The SFDA is looking into the CCTV report and has not released its findings yet, but authorities in Shandong have already shut two chicken farms in eastern China, including one that supplied KFC and McDonald's Corp, the official Shanghai Daily newspaper reported on Thursday.
KFC's subsidiary in China has pledged to cooperate with the authorities, while McDonald's wrote on its official microblog that its chicken and raw materials pass through independent, third-party laboratory tests.