Outbreaks of bird flu earlier this year are making eggs pricier.
The wholesale price for eggs peaked at $3.30 per dozen in recent months, according to a Sept. 12 U.S. Department of Agriculture report.
“Those are higher than average egg prices over the last number of years,” said Patrick Westhoff, the director of the Food and Agricultural Policy Research Institute at the University of Missouri.
Highly pathogenic avian influenza, commonly called bird flu, struck poultry facilities in several states this year. That includes Iowa — the largest egg-producing state in the country — Minnesota and Texas.
To limit the spread of the illness, producers culled many egg-laying hens, which resulted in a significant decrease in production. The USDA estimates that table egg production in July, the most recent month with available data, was about 2.6% lower than the same time last year.
Those tightened supplies led to the increased wholesale prices, which are ticking up the price customers are paying at the grocery store.
“Some, but not all, of that increase was passed to consumers through higher retail prices,” said Mirvat Sewadeh, a spokesperson for the USDA’s Office of the Chief Economist.
Since the initial detection of bird flu in February 2022, more than 100 million birds have been infected in the U.S. In January 2023, eggs reached a peak average retail price of $4.82 per dozen, according to data from the Bureau of Labor Statistics' consumer price index.
While bird flu outbreaks are the main culprit for increased egg prices, inflationary pressures have also played a role in making production more expensive, said Lee Schulz, an extension economist and professor at Iowa State University.
“The cost of doing business, transportation, wages, energy, all those things are much higher than the last decade,” Schulz said. “And so that has added to the price of eggs.”
Consistent demand
In general, eggs are more subject to price swings than other goods, Westhoff said. That’s because eggs are what most economists would call “inelastic,” which means demand is always there, regardless of price, according to Westhoff.
“So it's precisely because people will always want to keep buying eggs that we get these very big swings in prices every time there's a supply problem,” Westhoff said.
Although wholesale prices could fluctuate, they might not always reflect what shoppers are paying on a given day. Wholesale prices tend to differ from what customers actually pay. Some might even see discounts at the store, Sewadeh said.
“The impact on retail prices will depend on the pricing strategies of [retailers],” Sewadeh said. “Many retailers often choose to special eggs at favorable prices as a means of attracting store traffic ahead of the holidays.”
People tend to buy more eggs at the end of the year, when children head back to school and the winter holidays start to pick up, Schulz said.
Projected prices
The USDA projects the price of wholesale eggs could drop to $1.75 per dozen by next spring, which is roughly 50 cents lower than prices last spring, according to a recent agricultural market outlook.
“With higher production, the greater availability of eggs will be reflected in lower prices as the year progress and flocks are rebuilt,” Sewadeh said.
But Westhoff said that all depends on if there are any further bird flu outbreaks in commercial facilities.
“That's a big question mark right now,” Westhoff said. “There's been a couple of times where we may have hoped that we've gotten past the worst of it, only to be hit by additional cases. So we'll see what the next weeks and months and years portend in that regard.”
There hasn’t been an outbreak in a commercial laying facility since July 19, according to the USDA. Still, Sewadeh said the USDA will remain vigilant.
“USDA continues to work closely with state and industry partners on surveillance efforts to look for the virus and enact strong biosecurity measures to prevent its spread,” Sewadeh said.
