By Nichola Groom
CHICAGO (Reuters) - Guacamole lovers may have been spared the loss of their favorite food.
Burrito chain Chipotle Mexican Grill Inc. (CMG.N: Quote, Profile, Research, Stock Buzz) said its worst fears about an avocado shortage following freezing temperatures in California may be unfounded.
"It doesn't look like it's going to be as bad as people initially thought," President and Chief Operating Officer Monty Moran said at the Reuters Food Summit in Chicago. "We believe (avocado) prices may go up, but not substantially."
Still, the chain hasn't ruled out the possibility of having to take guacamole off the menu or raise prices temporarily.
"If the fruit wasn't of the quality that we need or if the cost was too high we would consider our options, which may include not selling guacamole for a while or even a temporary price increase on guacamole," Moran said. "We certainly would prefer not to do that."
Moran added that Chipotle would have a better idea of what the impact would be to both California avocado supplies and prices once the fruit is harvested this spring. Depending on the season, Chipotle also sources avocados from Mexico and Chile.
"It still has a chance of being a point of pressure, but it shouldn't be too bad," Moran said.
A better-than-expected California avocado harvest should come as welcome news to Chipotle, which is forecasting same-store sales increases in the low- to mid-single digits on a percentage basis after posting an increase of 13.7 percent in 2006. Continued...
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