Beyond Meat's (NASDAQ: BYND) deal to supply the patties for McDonald's (NYSE: MCD) 12-week test of a new plant-based burger called the P.L.T. in Canada, has shares higher and short-sellers feeling the squeeze.

Borrow rates, already sky-high at 141%, surged to between 300%-400% this morning, S3 Partners' Ihor Dusaniwsky noted.

"Not only are stock borrow rates climbing due to lack of lendable supply, that supply is now starting to dwindle as recalls are starting to hit the street as some long shareholders are beginning to sell and realize profits around the $150/share level," Dusaniwsky commented. "Due to this stock borrow scarcity, there will not be any BYND short selling in size until lendable supply increases. But since BYND has such a large lifestyle\retail stock ownership, whose shares are mostly fully-paid-for and not in stock lending programs, the chances of supply increasing is minimal."

With today's 10.9% move, shorts are down -$81.3 million in net of financing mark-to-market losses today, the firm notes. This increases year-to-date mark-to-market losses to -$731.6 million, down -92% on BYND’s average yearly short balance.

"BYND has been a short squeeze candidate for some time now, but shorts have hung onto their positions in a Tesla like fashion," Dusaniwsky added. "But with mark-to-market losses mounting, stock borrow rates accelerating to the upside and stock recalls hitting the street the likelihood of a short squeeze is very high."

If the stock price continues higher, this could turn into a “Whopper” of a short squeeze, he concluded.