The already-popular avocado is getting a turbo boost from higher supply and lower prices, and restaurants are eager to cash in.
Starbucks has added avocado spread to its permanent menu in the US and Canada after a successful test run last year, while Chili’s Grill & Bar this month began selling a hamburger with the fruit. Even fast-food chains such as Wendy’s are joining in.
And at restaurants such as Chipotle Mexican Grill, where avocados have always been a big deal, the lower prices may mean wider margins while prices remain low. About half of the company’s orders include guacamole.
Low hanging fruit
“It has a big impact when it goes up and down,” chief financial officer Jack Hartung said on a conference call last month, noting that the cost for a case had fallen to below US$30 from nearly US$80 during part of the fourth quarter. “So, they’ve come back to kind of normal prices.”
During the week of May 13, the US market got a deluge of more than 60 million pounds (27.2 million kilograms) of the fruit. That compares with about 47 million pounds last year.
The market has been underpinned by ample supply from Mexico, the largest producer, and California, according to US Foods Holding’s May 18 farm report.
The avocado’s popularity has broadened as more people strive to eat healthier and consume more fruits and vegetables. While the fruit is high in fat, most of it is of the unsaturated variety, which nutritionists say is beneficial. They’re also a good source of fibre, and don’t have any cholesterol.
Restaurants are acting quickly to take advantage of lower avocado prices and their rising popularity.
Last month, Wendy’s added a southwest avocado chicken salad and sandwich to its lineup. Diners love the salad, even with its 600 calories.
The offering “is a salad we’re excited about that’s clearly resonating with consumers right now”, CEO Todd Penegor said earlier this month.