Egg Prices Soar to Record Highs: Bird Flu or Corporate Profiteering?
The recent surge in egg prices has sparked intense debate over whether the increases are driven by the devastating bird flu outbreak or if large corporations are exploiting their market power to maximize profits. Egg producers argue that the outbreak has decimated their flocks, leading to a significant drop in supply and, consequently, higher prices. However, advocacy groups, Democratic lawmakers, and even a member of the Federal Trade Commission (FTC) have called for a government investigation into possible price gouging. With egg prices reaching a record average of $4.95 per dozen, the issue has become a hot-button topic, particularly as inflation continues to bite into household budgets.
The Industry’s Perspective: Blaming Bird Flu for the Crisis
Egg producers and industry experts point to the bird flu outbreak as the primary culprit behind the record-high prices. Since the outbreak began, more than 166 million birds, including 30 million egg-laying hens since January, have been slaughtered to contain the virus. The U.S. Department of Agriculture (USDA) has a longstanding policy of killing entire flocks when the virus is detected on a farm, a measure that has significantly disrupted egg supplies. According to the USDA, the number of egg-laying hens has dropped by about 12% since the outbreak, falling to 292 million birds as of February 1. However, another 11 million have been killed since then, worsening the supply crunch.
Emily Metz, president of the American Egg Board, insists that the price hikes are entirely due to the bird flu crisis. "This has nothing to do with anything other than bird flu," she said. "Our farmers are in the fight of their lives, period, full stop. And they’re doing everything they can to keep these birds safe." Metz emphasized that the situation is a supply issue, not a matter of corporate greed.
Critics Suspect Corporate Profiteering and Monopolistic Practices
Despite the industry’s claims, critics argue that the situation may not be as straightforward. Advocacy groups like Farm Action, which represents smaller farmers, consumers, and rural communities, suspect that dominant egg corporations are taking advantage of their market power to inflate prices. While the egg supply has dropped only about 4% from last year, and 7.57 billion table eggs were produced in January, many consumers are still finding empty shelves at their local grocery stores.
Angela Huffman, president of Farm Action, accused large egg producers of blaming bird flu for price hikes while their profits soar. "Dominant egg corporations are blaming avian flu for the price hikes that we’re seeing. But while the egg supply has fallen only slightly, these companies’ profits have soared," she said. Huffman’s suspicions are bolstered by a 2023 jury ruling that found major egg producers guilty of restricting domestic supply to drive up prices during the 2000s. This history adds fuel to concerns that similar monopolistic practices may be at play now.
The Numbers: Profit Soars Amid Rising Costs and Tight Supplies
Retail egg prices have more than doubled since the outbreak began, rising from below $2 per dozen to a record $4.95 per dozen. While most egg producers are private companies and do not disclose their financial results, Cal-Maine Foods, the largest publicly traded egg producer in the U.S., has reported a dramatic increase in profits. In the most recent quarter, the company made $219 million in profits, up from just $1.2 million before the outbreak began in early 2022. Cal-Maine’s CEO, Sherman Miller, attributed the higher profits to rising market prices and strong demand, noting that the company sold 330 million dozen eggs in the quarter, up from 288 million the year before.
However, critics argue that the price increases are disproportionate to the supply disruptions caused by the bird flu. While Cal-Maine admits that the virus has restricted supply, the company has largely avoided the worst of the outbreak, with only a few facilities in Kansas and Texas affected. This has allowed Cal-Maine to capitalize on the crisis while smaller producers bear the brunt of the losses.
The Human Cost: Farmers and Consumers Feel the Pain
The economic impact of the bird flu and subsequent price hikes extends far beyond corporate profits. Farmers who have lost their flocks to the virus are facing significant financial hardships. Once a flock is slaughtered, it can take up to a year to clean the farm and raise new birds to egg-laying age. While the USDA compensates farmers for the birds killed, the payments often do not cover all the costs associated with restarting production.
Consumers, meanwhile, are struggling to afford basic groceries as egg prices remain elevated. "The consumer, I think, will probably feel like they’re getting the rough end of the stick," said CoBank analyst Brian Earnest. "But I guarantee you, the farmers that are having to depopulate the barns, they’re having a rougher time."
What’s Next? Calls for Investigation and relief for Working Families
As the debate over egg prices continues, advocacy groups and lawmakers are calling for a government investigation into possible price gouging. Democratic Senator Elizabeth Warren has been particularly vocal, accusing the Trump administration of failing to deliver on promises to lower food prices. "Donald Trump promised to lower food prices on ‘Day One,’ but with egg prices skyrocketing out of control, he fired the workers charged with containing bird flu. Working families need relief now," she said in a statement.
The situation remains complex, with no easy solutions in sight. While some economists argue that the price increases are a natural response to supply and demand dynamics, others believe that corporate consolidation and monopolistic practices are exacerbating the problem. For now, both farmers and consumers are caught in the middle, grappling with the rising cost of eggs and the uncertainty of when prices might return to normal.
