Why the price of eggs is on the rise again

AP

The price of eggs is back on the rise, after significant bird flu outbreaks among egg-laying chickens.

Prices have risen 28.1% in the past year, according to the Bureau of Labor Statistics, and the average price for a dozen large, grade A eggs was $3.20 in August.

More than 100 million “wild aquatic birds, commercial poultry and backyard or hobbyist flocks” have been infected with bird flu since January 2022, according to the CDC.

Prices have spiked in recent weeks due to a large bird flu outbreak at two Colorado chicken farms in July. That, paired with higher consumer demand, is contributing to the sticker shock many Americans may be experiencing in the aisles, experts say.

Widespread bird flu outbreaks in recent years

Some of the most severe outbreaks of bird flu — highly pathogenic avian influenza, or (HPAI) — happened in 2014 and 2022.

More than 50 million birds died in the 2014-2015 outbreak, while more than 100 million birds have died since the outbreak that started in 2022. It has become the most deadly HPAI outbreak in history.

Amy Hagerman, an associate professor of agricultural economics at Oklahoma State University, says table egg-laying chickens seem particularly susceptible to HPAI, likely because the virus can spread quickly in their close quarters.

“Table egg-layer facilities tend to be very large, and so you can lose a million or 2 million birds on a single facility, because this is a highly contagious virus,” she says.

The most recent spike in cases happened in July, when millions of cases were reported in Colorado.

David Ortega, the chair of food economics and policy at Michigan State University, says farmers must take “precautionary measures in the operations. And when an outbreak is acting quickly, that is really necessary ... to prevent this from spreading to nearby operations.”

The U.S. Department of Agriculture suggests a number of biosecurity measures for poultry farmers, including hand-washing, minimizing visitors at facilities, changing clothes before and after handling poultry, and closely monitoring flocks for signs of illness.

When outbreaks occur, farmers can apply for financial assistance from the USDA to repopulate their flocks.

Does inflation have anything to do with the costs?

Bird flu is the main culprit for the increasing price of eggs, though “inflationary pressures” are also at play, says Emily Metz, president of the American Egg Board.

Higher prices for fuel, packaging, labor and feed can trickle down to the cost of the finished product — and be passed on to consumers.

“Egg farmers are price takers, not price makers, and the volatility that we’re seeing is reflecting a number of factors that are completely outside the control of the egg farmer,” Metz says.

Plus, while the supply is impaired, demand is still high.

Metz says retail demand for eggs has been up for 18 consecutive four-week periods, even during the summer, when people typically eat fewer of them.

“I think the good news here … is that Americans love their eggs,” she says.

Michigan State University's Ortega says current food prices are a culmination of events over the last few years, including the bird flu outbreak, the coronavirus pandemic and international conflicts.

“So, no, that doesn't mean that prices are coming down necessarily,” he says. “It just means that they're not increasing as quickly.”

Hagerman of Oklahoma State says, “I think that part of the challenge is if grocery prices still feel kind of high relative to where they were three or four years ago, then that additional increase on top of that just feels that much worse as a result.”

What can consumers expect next?

Bird flu is unpredictable, so it's hard to say how it may continue to affect egg prices.

However, evidence suggests surges typically happen in the spring and fall, as birds migrate. Additionally, when bird flu outbreaks happen, flocks have to be repopulated. For chickens, that can take four to five months, Ortega says.

If the outbreaks continue into the holidays, egg prices may increase, as demand is higher for baked goods, he adds.

Hagerman says restaurants may start charging more for egg dishes or change their menus, and consumers may start to substitute eggs for other proteins, such as meat and seafood.

“What we really need is for there to not be any more outbreaks in table egg layers, in order to see those prices come back down,” she says.

Metz of the American Egg Board says there is some hope, as wholesale prices for eggs have dropped 30% in the last few weeks, which usually signifies retail prices will follow in coming weeks.

“Eggs are one of the most affordable proteins money can buy, even at these slightly elevated prices,” she says. “I think it's really important to emphasize that.”