Analysis: The image has proliferated to such an extent that its exact origin is unclear.
In any case, it probably does depict the production of the processed food ingredient known as mechanically separated chicken (MSC), mechanically separated poultry (MSP), or, most generically, mechanically separated meat (MSM).
Mechanically separated poultry is defined on the USDA website as follows:
MECHANICALLY SEPARATED POULTRY is a paste-like and batter-like poultry product produced by forcing bones with attached edible tissue through a sieve or similar device under high pressure to separate bone from the edible tissue. Mechanically separated poultry has been used in poultry products since 1969. In 1995, a final rule on mechanically separated poultry said it would be used without restrictions. However, it must be labeled as "mechanically separated chicken or mechanically separated turkey" (depending on the kind of poultry used) in the ingredients statement. The final rule became effective November 4, 1996
Evidence for the claims are substantial and seem to be correct, according to MeatSafety.org, a website maintained by the American Meat Institute (a trade association). McDonald's has repeatedely denied that its Chicken McNuggets contain MSP. The McDonald's website states:
The only meat used in McDonald’s Chicken McNuggets is chicken breast meat. The white meat is minced before being shaped into nuggets, and then coated with a specially seasoned batter at our trusted suppliers, such as Keystone Foods.
Among the commercially sold products that are made with mechanically separated poultry, according to MeatSafety.org, are chicken and turkey franks, lunch meats, and "other processed products."
As stated above, USDA regulations require that all products containing MSP be labeled as such. Moreover, all mechanically separated meat products are USDA inspected and subject to the same quality standards as unprocessed meats.
Though poultry is sometimes treated with ammonium hydroxide during processing to lower acidity and retard bacterial growth, it's inaccurate to say the meat is "soaked" in ammonia. Ammonium hydroxide is a common food additive deemed GRAS (generally recognized as safe) by the FDA and safe and suitable for use in the production of meat and poultry products by the FSIS (Food Safety and Inspection Service of the USDA).