OMAHA, Neb. — While egg producers attribute soaring prices to the bird flu outbreak, critics argue that large corporations are exploiting their market power, unfairly impacting consumers with limited budgets.
Advocacy groups, Democratic legislators, and a member of the Federal Trade Commission are urging a government investigation following a record average egg price of $4.95 per dozen this month. A plan to address bird flu was recently announced by the Trump administration, but its effect on egg prices, a significant factor in inflation, remains uncertain.
“Donald Trump pledged to reduce food costs immediately, but with skyrocketing egg prices, he dismissed employees responsible for managing bird flu. Working families require immediate assistance,” stated Sen. Elizabeth Warren.
The industry and most experts attribute the price increases to bird flu, which has led to the culling of over 166 million birds to control the virus. Since January, approximately 30 million egg-laying hens have been eliminated, significantly reducing egg availability. The USDA’s established policy involves euthanizing entire flocks upon virus detection.
Consequently, the nationwide number of egg-laying hens has decreased by about 12% from pre-outbreak levels to 292 million, according to a USDA estimate from Feb. 1. However, an additional 11 million hens have been culled since then, suggesting the situation is likely worse. When prices rose to $4.82 two years ago, prompting initial price gouging inquiries, the flock size was above 300 million.
“This is solely due to bird flu, and any other suggestion misrepresents the facts,” stated American Egg Board President Emily Metz.
“Our farmers are battling for survival and doing everything possible to protect their flocks,” Metz added. “This is a supply issue caused exclusively by bird flu.”
Farm Action suspects monopolistic practices, noting that egg production is only down about 4% from the previous year, with roughly 7.57 billion table eggs produced last month. Despite this, some consumers are encountering empty egg shelves in stores. Farm Action advocates for smaller farmers, consumers, and rural communities.
“Dominant egg corporations are citing avian flu to justify price increases. However, while the egg supply has only slightly decreased, these companies’ profits have surged,” stated Angela Huffman, president of Farm Action. The Justice Department acknowledged receipt of the group’s request for an investigation but declined to comment.
A 2023 jury verdict finding that major egg producers manipulated the domestic egg supply to inflate prices in the 2000s further fuels doubts about their current motives.
What do the numbers show?
Retail egg prices generally remained below $2 per dozen for years before the current outbreak. Prices have since more than doubled, increasing profits for egg producers despite rising costs.
While most major producers are privately held and do not disclose financial data, Cal-Maine Foods, the largest supplier (approximately 20% of the nation’s eggs) is public, and its profits have risen sharply. Cal-Maine reported a $219 million profit in the most recent quarter, with eggs averaging $2.74 per dozen, a significant increase from the $1.2 million profit in the quarter preceding the outbreak in early 2022, when eggs sold for $1.37 per dozen.
Cal-Maine’s President and CEO, Sherman Miller, attributed the higher market prices to restricted shell egg supplies due to recent avian influenza outbreaks.
He noted that Cal-Maine also sold considerably more eggs (approximately 330 million dozens, up from 288 million the previous year) due to strong demand and acquisitions. Cal-Maine experienced few outbreaks, except at facilities in Kansas and Texas. The Mississippi-based company did not respond to inquiries from The Associated Press.
What about production costs?
Economists and analysts caution that record egg prices do not necessarily indicate wrongdoing, and short-term profits may be short-lived if farms are affected. After a flock is culled, it can take up to a year to sanitize the farm and raise new birds to egg-laying age. The USDA compensates farmers for each bird killed, but this does not fully cover their lost income.
“Consumers may feel unfairly burdened, but farmers forced to depopulate barns are facing even greater hardship,” stated CoBank analyst Brian Earnest.
Rising costs for feed, fuel, and labor have contributed to higher egg prices, and farmers have invested in biosecurity measures to prevent the virus. According to the U.S. Bureau of Labor Statistics’ producer price index, production costs also appear to be at record highs.
“This isn’t price gouging; the price is increasing at wholesale auctions. Producers are benefiting from higher prices due to limited supplies,” stated University of Arkansas agricultural economist Jada Thompson.