McDonald’s licensee in Kazakhstan was forced to temporarily close its restaurants this month after cutting ties with Russian companies and running out of supplies, three sources with knowledge of the situation told Reuters.
The case highlights the supply problems faced by many Kazakh companies in the wake of Russia’s invasion of Ukraine and the Western sanctions against Moscow that followed. Neighboring Russia is Kazakhstan’s main trading partner.
In a statement, the US-based company said its “licensee in Kazakhstan has temporarily closed all of its restaurants due to local supply issues. We are working together to resume operations as quickly as possible.”
Food Solutions, the Kazakhstan licensee company, announced the closure on November 17, citing “local supply issues.” He did not respond to requests for comment.
In the past six years, McDonald’s has become a major player in the fast food market in Kazakhstan, a Central Asian nation of 20 million people, and has expanded its network to 24 restaurants.
The company had purchased some supplies from abroad, such as beef and chicken. The latter was sourced from Russia’s Miratorg, according to its website.
After Russia invaded Ukraine in what Moscow calls a “special military operation,” McDonald’s pulled out of Russia and sold all the restaurants it owned to a local licensee in May.
Food Solutions, which is owned by prominent Kazakh businessman Kairat Boranbayev, also began looking elsewhere for suppliers and stopped buying Russian products at some point, a source close to the company said.
Another source said he started running out of packaging materials, also imported from Russia, in recent months and had to cut back on his menu. Both sources were not authorized to speak publicly on the matter.
The source said the licensee was now awaiting deliveries from other vendors and planned to reopen its restaurants in December. It was not clear where the decision to get rid of the Russian suppliers originated.
Marr Russia, one of the Russian suppliers to the Kazakh company, said it never worked directly with McDonald’s, instead dealing with its Kazakh logistics partner, HAVI. Therefore, he could not say if sales to Kazakhstan stopped, he added. HAVI declined to comment.
Miratorg said it was a supplier to Vkusno & Tochka, the Russian successor to McDonald’s, and did not directly address the issue of Kazakh sales.
Cargill Russia, also previously mentioned by Food Solutions among its suppliers, said it had sold the McDonald’s-related business to Russian meat producer Cherkizovo, which did not immediately respond to a request for comment.
Kazakh Deputy Prime Minister Serik Zhumangarin, when asked about McDonald’s at a briefing on Tuesday, said he could not reveal the reasons for its temporary closure, adding that the government was helping the company locate its supplies.
