What's Going on With Egg Prices?
The steadily-climbing price of eggs has cracked the public discourse. Social media buzz and news headlines have been building in the early days of 2023, calling out price hikes for this food staple.
Frequent media commentator and former multi-million-dollar money manager Genevieve Roch-Dector tweeted on Jan. 8 that “Eggs are the new bitcoin” with a graph showing recent spikes. Other social media users posted photos of egg prices – topping $11 a dozen at some specialty grocers – and shared images of empty shelves at their local grocery stores.
In California, the cost of a dozen eggs has reached $7.37, nearly $3 more than the beginning of December. Nationally, the Consumer Price Index (CPI) for eggs has been on a consistent climb, up 49.1% on an unadjusted basis from November 2021 to November 2022, according to the U.S. Bureau of Labor Statistics. From October to November alone, the CPI for eggs rose 2.3%.
Eggs are not the only commodity that has experienced a price surge over the past year, as beef, pork and chicken prices also reached a peak. That said, the traditional economic driver of supply and demand has hit this food category especially hard.
The spread of highly pathogenic strain of bird flu that began about a year ago has continued to hamper populations and, hence, egg supplies. According to the U.S. Department of Agriculture (USDA), nearly 50 million birds died or were culled due to the virus in 2022. In November, USDA affirmed that outbreaks in poultry and wild birds continue across the country.
Dr. Jayson Lusk, the head and distinguished professor of agricultural economics at Purdue University in West Lafayette, Ind., told Progressive Grocer that converging circumstances have spurred the recent upticks. “A number of factors have contributed to rising egg prices including higher feed and energy costs, strong demand and perhaps most important, bird flu. Over the course of 2022, a little over 10% of the egg laying flock was lost to the disease,” he said.
Emily Metz, president and CEO of the American Egg Board, likewise pointed to simultaneous challenges. “Current wholesale egg prices reflect many factors beyond a farmer’s control, including inflation and supply chain challenges related to cost and availability of feed and grain, labor, diesel fuel and shipping,” she noted.
So, when will grocers see relief? Now that holiday baking and cooking season is over, demand for eggs is settling a bit. Meanwhile, farmers and producers are working to increase their supplies following often-substantial bird losses in 2022.
Metz underscored that point. "The good news is that egg farms are recovering quickly. In fact, most of the egg farms that were affected by HPAI this year have recovered and are back to producing eggs. Nationwide, according to USDA, we have approximately 6% fewer hens laying eggs right now than we might normally, so egg farms are recovering quickly, but we’re not all the way back yet,” she explained.
In its egg market news report for Jan. 9, the USDA noted that supplies are “light to mostly moderate” and indicated that retail demand is “moderate to fairly good” while distributive demand is “light to moderate.” USDA’s latest eggs market overview shows that wholesale prices for cartooned shell eggs are edging lower; in the New York market, the wholesale price for large cartooned shell eggs delivered to retailers dropped $0.60 to $4.59 per dozen, while the California benchmark for large shell eggs dipped $0.13 to the still-high cost of $7.37 per dozen.
“As the new year gets underway, more than a few consumers are looking to modify their dietary choices to support freshly-minted healthier lifestyle resolutions and eggs remain a popular go-to option,” USDA researchers noted. “Recent record high egg prices have begun to soften but it will take some before this is reflected at the dairy case.”
Lusk agrees that higher-than-usual egg prices will likely stay in the public realm. “Until bird flu dissipates and feed costs subside, we will continue to see upward price pressure,” he remarked.
In this environment, food retailers in some areas are facing other pressures related to eggs. For example, as of Jan. 1, retailers in Colorado cannot sell eggs that are not cage-free. Several other states have that mandate in place for 2024.