McDonald’s is the latest company to issue recall over CDC’s complaint

The foodborne illness outbreak related to the popular fast-food chain McDonald’s (MCD) has been in news since May. And now it appears that McDonald’s is forced to stop selling the salads — which is related to the occurrence of intestinal parasites — in nearly 14 states across its 3,000 outlets.

According to the CDC, 61 people in seven states have suffered after consuming McDonald’s salad. Out of seven states, Iowa and Illinois were among the hardest hit. The multistate outbreak of cyclospora illness, an intestinal illness that is caused by eating the contaminated food, is being investigated by the health officials at Iowa and Illinois, Centers for Disease Control and Prevention (CDC), and the Food and Drug Administration (FDA). The health officials are working on identifying the salad ingredient that leads to sickness in people and later traces it back to the supply chain.

Recalls due to parasitic infection

It appears that there is a spike in food recalls. McDonald’s — that recently opened its new headquarters in Chicago — isn’t the only company that is at the center of an investigation by health officials. Kellogg’s (K) is another company that has voluntarily recalled over 1 million cases of its popular breakfast cereal Honey Smacks after it was linked to a multistate outbreak of salmonellosis. The FDA and CDC are investigating this case. According to the CDC, nearly 100 people were affected in 33 states after eating the cereal.

The FDA also learned that despite the recall made in June, many retailers are still selling the recalled product.

Even the San Francisco, California-based Del Monte — producers, distributors and marketers of branded food — had voluntarily recalled vegetable trays after possible parasite contamination.

Cost of product recalls

Recalls often tend to weigh on food companies’ margins, with direct costs coming in at about $10 million on an average, according to the Food Marketing Institute (FMI) and the Grocery Manufacturers Association (GMA). Recalls not only leave a hefty dent in the company sales but can also damage the brand’s image.

Shares of McDonald’s, which were down 8% so far in this year, were trading flat during the morning trading session today.