Restaurant-chain Chipotle (CMG) issued an ominous warning about the effects of climate change on some of its menu items, including – brace yourselves – guacamole and salsa. In a regulatory filing with the Securities and Exchange Commission, Chipotle warned that increasing weather volatility, including global climate change could have a significant impact on the price or availability of some of its regular ingredients. “In the event of cost increases with respect to one or more of our raw ingredients, we may choose to temporarily suspend serving menu items, such as guacamole or one or more of our salsas, rather than paying the increased cost for the ingredients,” the company stated in its most recent 10-k filing.
But a Chipotle spokesperson assured Hot Stock Minute there is no reason to panic just yet. "This is nothing more than routine and required 'risk factor' disclosure," Communications Director Chris Arnold said in an email statement. "The sky is not falling."
According to Chipotle's website, the company uses 97,000 pounds of avocados a day and 70 avocados to make a single batch of guacamole.
Guacamole and salsa were not alone, however. Chipotle also warned that higher prices due to climate change could impact the price of other menu items, including basics, such as chicken, beef, cheese, avocados, beans, rice, tomatoes and pork. The company warned the rising prices could have a negative impact on its restaurant traffic and its brand.
In the associated video, Yahoo Finance Editor-in-Chief Aaron Task says it’s an interesting corporate decision if Chipotle chooses to remove salsa or guacamole, rather than give customers the choice to pay a little more for those items. “Do you want to pay $2 extra for guacamole or $0.50 for salsa which you used to get for free?” asks Task.
Task also points out that part of Chipotle’s appeal is that the company tries to buy from local farmers and also from organic farmers more than most other food chains. But will that make up for a dry burrito? “I wonder how those consumers are going to feel if they’re not going to have the choice to have guacamole or salsa with their Chipotle,” said Task.
The weather already has wreaked havoc on the economy this winter with auto sales, employment reports and manufacturing feeling the impact of the polar vortex. Now, even condiments are in danger.
The Chipotle filing was first highlighted by thinkprogress.org.
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