While egg producers attribute the record-high prices on the avian flu outbreak, others contend that large corporations are abusing their market dominance to make large profits at the expense of consumers who are on a tight budget.
After egg prices surged to a record average of $4.95 per dozen this month, advocacy organizations, Democratic politicians, and a member of the Federal Trade Commission are demanding a federal inquiry. This week, the Trump administration unveiled a plan to fight bird flu, but it is unclear how much it will help egg costs, which are a major cause of inflation.
On Day One, Donald Trump pledged to cut food prices; but, as egg prices soared out of hand, he fired the employees who were responsible for controlling avian flu. In a statement, Senator Elizabeth Warren stated, “Working families need relief now.”
What s behind the record egg prices?
Bird flu is directly blamed by the industry and the majority of specialists. To limit the infection, almost 166 million birds have been killed. The loss of almost 30 million egg layers since January has caused a major disruption in the supply of eggs. Every time the virus is discovered on a farm, the Department of Agriculture has a long-standing policy of killing entire flocks.
As a result, according to a USDA estimate from February 1, the number of egg layers has decreased statewide by roughly 12% from before the outbreak to 292 million birds. However, since then, an additional 11 million egg layers have been killed, so the situation is probably worse. The flock reached more than 300 million when prices jumped to $4.82 two years ago, sparking the first calls for price gouging investigations.
Other than bird flu, this has nothing to do with anything. According to Emily Metz, President of the American Egg Board, “I believe that to suggest anything else is a misreading of the facts and the reality.”
Without exception, our farmers are fighting for their life. According to Metz, they are making every effort to ensure the safety of these birds. This is a problem with supply. because of avian flu. Nothing more.
Farm Action believes there may be monopolistic practices. Some people are still finding egg shelves empty at their local grocery stores, despite the fact that egg production is only down about 4% from the previous year and that 7.57 billion table eggs were produced last month, according to the nonprofit that advocates on behalf of smaller farmers, consumers, and rural communities.
The avian flu is being blamed by dominant egg businesses for the recent price increases. However, according to Farm Action President Angela Huffman, these corporations’ earnings have skyrocketed, despite the egg supply just marginally declining. While acknowledging receipt of the group’s letter requesting an investigation, the Justice Department chose not to comment.
The fact that a 2023 jury found that large egg farmers employed a variety of tactics to restrict the domestic supply of eggs in order to raise product prices in the 2000s only serves to raise more questions about their current intentions.
What do the numbers show?
Prior to the start of this pandemic, retail egg prices have often been below $2 per dozen for years. Since then, prices have more than doubled, increasing egg producers’ profits despite skyrocketing expenses.
The majority of the leading producers are privately held businesses who withhold their findings. However, the largest, Cal-Maine Foods, which provides over 20% of the country’s eggs, is publicly traded and saw a sharp rise in profits. When its eggs sold for an average of $2.74 per dozen in the most recent quarter, Cal-Maine reported a $219 million profit. This is a significant increase from the $1.2 million it made in the quarter immediately prior to the outbreak in early 2022, when its eggs were selling for $1.37 per dozen.
In announcing the figures, Sherman Miller, president and CEO of Cal-Maine, stated that increased market prices have persisted throughout this fiscal year as shell egg supply levels have been limited because of recent outbreaks of highly dangerous avian influenza.
However, he noted that because of the high demand and several acquisitions, Cal-Maine also sold a lot more eggs during the quarter—about 330 million dozen—than it did the year before, when it sold 288 million. With the exception of a few sites in Kansas and Texas, Cal-Maine also saw few breakouts on its farms. The Associated Press called the Mississippi-based corporation, but they did not answer.
What about production costs?
Record egg prices, according to economists and observers, are not necessarily an indication of a sinister trend, and temporary gains may only continue until farms are impacted. Cleaning a farm and raising new birds to egg-laying age might take up to a year after a flock is killed. Farmers receive payment from the USDA for each bird killed, but this does not cover all of their expenses because they are left without money.
I believe that the consumer will likely feel that they are being treated unfairly. However, I can assure you that farmers who are forced to empty their barns are struggling more, according to Brian Earnest, a CoBank analyst.
Farmers have been investing in biosecurity measures to help keep the virus at bay, and increased egg prices are a result of inflation in the expenses of labor, fuel, and feed. According to the producer price index published by the U.S. Bureau of Labor Statistics, production costs likewise seem to be at an all-time high.
They are not raising the price to take advantage of the market in this instance. Through wholesale auction, the price is rising. According to Jada Thompson, an agricultural economist at the University of Arkansas, they are profiting from increased pricing as a result of limited supply.
The Associated Press
