McDonald's raises prices to offset food costs

(McDonald's)

A meal at McDonald's is slated to take a bigger bite out of diners' wallets over the course of the year.

Rising food prices around the world have forced the burger giant to pass some of the costs on to the customer, the company said in an investor conference call Thursday.

"We plan to offset some, but not necessarily all, of the inflationary pressures with price increases," said the company's chief financial officer Pete Benson.

Customers in the US, Europe and China can expect to see small increases rolled out throughout the year on select menu items.

Prices had already gone up one percent in March in the US and Europe.

The price of commodities and other 'grocery items' for the chain are expected to rise between 4 and 4.5 percent in the US and Europe this year, due to shrinking herd sizes, increased demand and the weak US dollar. Beef accounts for one-third of price increases.

Meanwhile, the company also announced new menu strategies that will focus on expanding the McCafé, smoothie drinks and the development of proprietary drinks.

In addition to piloting items like a spicy chicken sandwich, McDonald's is also testing out Chicken McBites, an item that was rolled out in Australia and is currently being trialed in Detroit with sauces like Sweet Chili, Creamy Ranch, Spicy Buffalo, Honey Mustard, Sweet ‘n Sour and Tangy Barbecue.

Like KFC's Popcorn Chicken, the Chicken McBites are bite-sized pieces that are billed as crispier than Chicken McNuggets with a southern-style coating, reports industry site BurgerBusiness.

McDonald's Chicken McBites come on the heels of Burger King's revamped recipe for Chicken Tenders launched last month, which were reformulated with a new breaded coating and new shape.

Pineapple mango smoothies and strawberry lemonade are also in the pipeline, in time for their summer menus in North America, Asia and Europe.

The company is also looking at bringing back its Asian salad.

McDonald's has 32,000 restaurant in 117 countries.