Avocado prices are entering "holy guacamole" territory.
Prices for avocados have surged in the past year, with the retail price of a single Hass avocado jumping 26 percent from February to March alone, according to the Hass Avocado Board. The price of a 22-pound box of avocados from the biggest producing state in Mexico has doubled over the past year and reached a 19-year high, Bloomberg News reports.
That will lead to pricer guacamole this Cinco de Mayo, as well as even more precious avocado toast for the hipster set. The popularity of the fruit is partially to blame, with Americans eating about 7 pounds of avocados per year in 2014, compared with 1.1 pound per capita in 1989. Even Starbucks (SBUX) is getting in on the trend, with the coffee chain introducing an avocado spread for toast earlier this year.
Another reason for the higher costs are expectations of a smaller harvest, Bloomberg noted. Avocado trees produce annual harvests that cycle between large and small crops, and this year is slated to be a lighter haul.
The average price of a Hass avocado reached $1.25 each in mid-March, up from 99 cents in mid-February, according to the Hass Avocado Board. That might not be enough to cause brunchers to forgo their avocado toast, but it's causing stress for some restaurants.
Chipotle (CMG) executives cited a "short supply environment" for avocados in its first-quarter earnings conference call. Chief financial officer John R. Hartung added, "This is still putting some pressure on our costs," which he projected would ramp up through the third quarter.
The surging popularity of avocados is tied to its makeover as a healthy treat. Its high fat content was once viewed as a negative, but nutritionists now stress the fruit's mono-unsaturated oil, potassium, B vitamins and other vitamins as a nutritious dietary choice.
Avocados from Mexico is now advertising the fruits as beneficial, thanks to a shift in the U.S. Food & Drug Administration's policy on using "healthy" in advertisements. The government agency said foods that aren't low in fat can use the term in marketing, as long as their fats are mostly mono and polyunsaturated fats.
Avocados From Mexico President Alvaro Luque told CBS MoneyWatch earlier this year that the importer intended to get that message across to Americans in its third Super Bowl ad. He said, "That wasn't happening two to three months ago, and we want to take advantage of this."