McDonald's hit by major issue as largest fry producer closes down - and a new meal is to blame

McDonald’s is facing a fry issue as its largest supplier has shut off production. The company is blaming one of McDonald’s budget meal options.

Lamb Weston, an Idaho-based company, announced the closure of its plant at Connell, Washington, and a 4% cut in its workforce earlier this month. The news comes as part of a restructuring plan expected to generate nearly $55 million of pre-tax cost savings for the company in 2025.

Lamb Weston spokesperson Teresa Paulsen told TODAY.com, “Lamb Weston is confident in the world’s ongoing love of fries - the closure of one of our older facilities accounts for less than 5% of our production capacity, so this adjustment simply helps address a current supply-and-demand imbalance.”

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However, Lamb Weston is pointing fingers for the recent closure. They are blaming McDonald’s $5 meal deal, which was introduced back in May. The meal was created to provide an affordable option for American families, during a time when inflation remains incredibly high, and fast food traffic has slowed. The $5 Meal Deal was a big hit, but Lamb Weston believes it has caused many consumers to order smaller portions of fries than they did before.

CEO Tom Wener said: “Restaurant traffic and frozen potato demand, relative to supply, continue to be soft, and we believe it will remain soft through the remainder of fiscal 2025.”

Werner explained that Lamb Weston’s decision to close one of its plants and cut costs is an effort to remain proactive to improve operating efficiency, profitability and cash flows.

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