NEW YORK: McDonald's Corp will start selling bags of its ground coffee in major Canadian stores in November, its Canadian chief said, in a likely challenge to rivals like Starbucks Corp, Dunkin' Donuts and Tim Hortons Inc.
The McCafe-branded coffee, priced at C$ 6.99 for 340 grams (12 ounces), is being launched as McDonald's steps up its expansion in Canada after holding back for more than five years.
Representatives for McDonald's said they were not aware of the company selling bagged coffee anywhere outside Canada.
Earlier this month, market watchers noticed McDonald's had filed with the US Patent and Trademark Office to use its McCafe brand for "ground and whole bean coffee." Some speculated that the company might launch bagged coffee in the US market.
Speaking in an interview, McDonald's Canada President John Betts credited the coffee business for a turnaround at his unit and said there was the potential for a much larger footprint across the country.
"This year, we're going to build more restaurants than we've built in the last seven or eight years," he said. "Next year, it's going to ramp up from that."
Around 30 new stores will open by the end of 2012, Betts said. He did not give specific figures for future periods. McDonald's has about 1,400 outlets in Canada.
Coffee is not an obvious point of entry in Canada, where Starbucks is ubiquitous and doughnut and coffee chain Tim Hortons borders on a national symbol. But between McDonald's coffee push and Tim Hortons' expanding lunch menu, the two chains are increasingly going head to head.
Tim Hortons, Starbucks and Dunkin' Donuts already sell packaged coffee.
A US spokeswoman for McDonald's said this is not the first time McDonald's has sold bagged coffee, but did not offer other examples.
Privately held Mother Parkers Tea & Coffee, McDonald's long-time coffee supplier in Canada, will also provide the bagged coffee for the chain.
Betts' upbeat message stands out against last week's earnings release, when McDonald's reported its worst quarterly restaurant sales growth in nine years thanks to tough competition in the US.
All the Canadian stores will give out free takeout coffee next week, Betts said, the eighth round of that promotion, which the company has also run in some US stores.
In the company's home market, fast-food players are dueling for customers with aggressive promotions, and bagged coffee and similar products have become a significant line of business.
In Starbucks' fiscal year ended Oct. 2, 2011, bagged coffee, bottled drinks and coffee served in hotels and offices accounted for $ 1.06 billion of its $ 11.70 billion in overall revenue.
Still, Bernstein Research analyst Sara Senatore said a McDonald's entry into the bagged coffee market would not necessarily shake up the US market.
"It's a different price point, flavor profile, and customer" than Starbucks, she wrote in an email. "The others may be closer in flavor profile but again, (Dunkin's) business seems to have held up well in the face of (McDonald's) entry into specialty coffee."
McDonald's started rolling out its McCafe line, which now includes espresso-based beverages and smoothies, in 2009.
Over the long term, Betts said, McDonald's may also look at the expanding market for single-cup coffee brewing.
The company does not currently sell K-cups, used in Green Mountain Coffee Roasters Inc's Keurig machines, or similar products for competing systems.
"Down the road, as our coffee journey and beverage journey evolves, we'll look at other things, certainly grocery, and K-cups and all those kind of things," said Betts.
Tim Hortons recently entered the single-serve coffee market, joining chains like Starbucks and Dunkin' Donuts, a unit of Dunkin' Brands.
McDonald's to launch bagged coffee in Canada
McDonald's to launch bagged coffee in Canada
CMA CGM, global carriers suspend Gulf transits on security fears
RIYADH: Shipping and logistics across the Middle East were disrupted after major carriers halted routes and ordered vessels to seek shelter following joint US-Israeli attacks on Iran and Tehran’s warning restricting transit through the Strait of Hormuz.
At least 150 tankers, including crude oil and liquefied natural gas vessels, dropped anchor in open Gulf waters beyond the Strait of Hormuz, while dozens more were stationary on the other side of the chokepoint, shipping data showed on March 1, Reuters reported.
The tankers were clustered in open waters off the coasts of major Gulf oil producers, including Iraq and Saudi Arabia, as well as LNG giant Qatar, according to Reuters estimates based on ship-tracking data from the MarineTraffic platform.
This comes as French shipping giant CMA CGM instructed vessels operating in the Gulf to move to safe shelter and suspended some Suez Canal transits as security risks escalated along one of the world’s busiest trade routes.
The Strait of Hormuz, a narrow waterway between Iran and Oman, is one of the world’s most critical energy chokepoints, carrying about 30 percent of global oil supplies along with significant volumes of liquefied natural gas.
The world’s third-largest container line said all vessels currently inside or bound for the Persian Gulf had been instructed to proceed immediately to safe shelter, while certain canal transits were halted until further notice and ships were rerouted via the Cape of Good Hope, according to a statement.
The precautionary move comes as shipping companies reassess operations across the region following military strikes and retaliatory attacks that have heightened security risks along critical maritime corridors linking Asia, Europe, and the Middle East.
“This decision is dictated by safety considerations and is made in compliance with our Bill of Lading Terms and Conditions,” the statement said.
It added: “Customers will be contacted as soon as we have more details of the possible alternative ports where their cargo could be discharged.”
The UK Maritime Trade Operations warned that the regional maritime security environment remains unstable, citing heightened military activity across key shipping lanes.
“The maritime security environment across the Arabian Gulf, Gulf of Oman, North Arabian Sea, Bab al Mandab and the Strait of Hormuz remains highly volatile, with ongoing regional military activity contributing to an elevated threat to commercial shipping,” UKMTO said in an advisory.
The agency added that mariners should expect disruption to navigation and communications systems.
UKMTO said there is “significant military presence and activity across the region” and warned vessels of an increased risk of miscalculation or misidentification near sensitive maritime infrastructure.
Despite circulating reports, the agency said “no official closure of the Strait of Hormuz has been formally communicated to the maritime industry through recognized maritime safety channels.”
Separately, Japanese shipping companies have also begun restricting movements near the Strait of Hormuz, Reuters reported.
Nippon Yusen instructed vessels to halt transit in the area on Feb. 28, while Mitsui O.S.K. Lines said its ships were remaining in safe waters, citing crew and cargo safety as its top priority.
Kawasaki Kisen Kaisha said several of its vessels in the Persian Gulf were placed on standby, noting that, unlike other maritime routes, there are limited diversion options for ships operating near the strait.
“Until the situation stabilizes, we will not attempt to send vessels through the strait, nor dispatch additional ships towards the area,” a spokesperson said.
German shipping group Hapag-Lloyd has also suspended all vessel transit through the Strait of Hormuz until further notice because of the evolving security situation, it said.
This comes as a Palau-flagged oil tanker was hit off Oman’s Musandam peninsula on March 1, injuring four crew members, the country’s Maritime Security Centre said, following drone strikes on the Gulf nation’s commercial port of Duqm, Reuters reported.
The incidents mark the first time targets in or near Oman have been struck since Tehran launched retaliatory attacks across Gulf states after joint US-Israeli strikes on Iran.
The 20-member crew of the Skylight tanker was evacuated after the attack, which occurred about five nautical miles north of Khasab Port in Musandam, according to the maritime authority in a post on X. The centre did not specify what hit the vessel but said four crew members, among them 15 Indian and five Iranian nationals, suffered injuries of varying severity.
Oman’s Musandam peninsula shares control of the Strait of Hormuz with Iran, a strategic chokepoint through which roughly one-fifth of global oil consumption passes.
Earlier in the day, Oman’s state news agency reported that Duqm commercial port was struck by two drones, injuring one expatriate worker. Debris from another drone fell near fuel storage tanks, though no additional casualties or material damage were recorded.
