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McDonald's adds guacamole to the menu

Some McDonald's (MCD) restaurants have begun adding guacamole to burgers, Egg McMuffins and even French fries for a small charge.

So far, the move seems limited to some locations in Denver. "This market really has a flavor for guacamole and we wanted to jump into it," Tom Carlson, the owner of four locations in Denver, told news station KDVR.

The restaurants are selling a $4.79 guacamole burger that includes pico de gallo and white cheddar cheese. But diners can also order a guacamole topping on any sandwich, including breakfast sandwiches, for 89 cents. They can also get a side of guacamole as a dip for fries for the same price.

It's unclear whether the move is part of a broader test for the chain or an experiment by one franchise owner. McDonald's has offered guacamole before, such as in a 2010 test of a chicken flatbread, reports Burger Business. McDonald's is also including guacamole as an option in its "build your own burger" test program underway in Southern California.

This may not be the best time to go all-in on guacamole. Rival Chipotle Mexican Grill (CMG) hinted in a regulatory filing earlier this year that price increases for raw ingredients could hurt. "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 said.

That created a small panic about a "guacageddon," and Chipotle eventually had to tell everyone to calm down. "This is way overblown," spokesman Chris Arnold told MarketWatch. "It's routine 'risk factor' disclosure."

Still, avocado prices have risen along with most fruit and vegetables lately as a three-year drought in California continues to harm crops. A recent study by Arizona State University projected that avocado prices could rise 35 cents to $1.60 each this year. California is the only state with a significant avocado crop, The Wall Street Journal reported.

Consumerist speculates that McDonald's premium guacamole burger and guacamole with fries "are meant to compete" with Chipotle and Smashburger. Twitter users, however, seemed a little uneasy with the idea. "I'm scared to try it," wrote one user. "I'd like @McDonalds to just get my order right," wrote another. "If you're eating guacamole from McDonald's you need to reevaluate your life," chimed in another.

  • Kim Peterson

    Kim Peterson is a financial journalist covering business and the economy. She has written for several online and print publications, including MSN Money and The Seattle Times.