Chipotle: Guacamole at Risk From Global Climate Change
Chipotle has something to say to customers worried about not being able to get their guacamole fix: “the sky isn’t falling.”
The burrito chain identified global weather patterns as business risks in its annual filing last month, causing some concern over the availability of guacamole and salsa.
“Food prices for a number of our key ingredients escalated markedly at various points during 2013 and we expect that there will be additional pricing pressures on some of those ingredients, including avocados, beef, dairy and chicken during 2014,” the company stated in the report.
The company also said that if prices of some of their raw ingredients increased, it might temporarily suspend some menu items, including guacamole as well as some of its salsas “rather than paying the increased cost for the ingredients.”
Chris Arnold, spokesperson for Chipotle (NYSE:CMG), told FOX Business that because the company uses fresh ingredients, weather can impact supply. “We are required to disclose issues that could present risks to our business – like supply constraints or higher food costs - and we are very thorough in making those disclosures.” He added, “The sky isn’t falling.”
The company also cited global climate change as a potential risk to the company.
“Weather volatility or other long-term changes in global weather patterns, including any changes associated with global climate change, could have a significant impact on the price or availability of some of our ingredients.” The company specifically cited possible price increases to avocados, chicken, beef, cheese, tomatoes and pork.
Arnold said the information is “nothing more than routine ‘risk factor’ disclosure” and that in regard to avocados, “we saw similar issues in 2011 and incurred higher prices for the avocados we used, but never stopped serving guacamole.”
FOX Business reporter Sandra Smith contributed to this report