McDonald's sales decline first in five years

McDonald's fast food restaurants posted their first month-to-month sales decline in five years in March. Blamed was the slowing U.S. economy, which has people eating more at home and eating "lower on the hog" when they do go out.

McDonald's is the number one marketeer of beef in America in terms of total tonnage, so the sales drop is not good news for the cattle industry. After all, if McDonald's sales fall, you can only imagine what they'll do in the white-table-cloth restaurant segment. Cattle numbers are down, so beef production is down, so some sales drop is probably already built into the system. The loss will be in imported beef McDonald's uses to fill out its grinding needs, as The U.S. traditionally sells all the beef its producers produce.

McDonald's is introducing lattes and other fancy coffee drinks to build its breakfast trade, as well as other non-beef items at other times of the day. It's too early in this process to say if they contributed or not. In fact, there was no breakdown provided of where in the McDonald's menu the sales decline actually came.

Of concern for the cattle industry, is that most likely, McDonald's is not alone in declining sales. Lesser brands like Burger King and Wendy's are bound to be down too. One can only hope that supermarket beef sales go up smartly, as an indication that people are cooking and eating at home, rather than eating out.

The one thing we can be sure of, is that people are still eating--it's a necessity.