Tomorrow, we’ll get a reading on January egg prices at the consumer level. With futures prices at about $5.2 in December and $6.65 in January, I’d guess retail egg prices will have gone up. Futures are at $7.65 so far in February.

(Click on image to enlarge)

Figure 1: Top panel – Consumer Price of Dozen Eggs (blue, left scale), ERS forecast of January 2025 for end 2024 (blue square, left scale), both in $, and PPI for fresh eggs (tan, right scale), 1991M12=100. Bottom panel: Trading Economics futures price for dozen eggs (blue), and TradingEconomics model and analyst based forecast (gray). Source: BLS, ERS, TradingEconomics.com.

The USDA’s Economic Research Service January 2025 forecast indicates a $5/dozen price by end-2025. This forecast is based on a time series model. TradingEconomics’ forecast of $9.67/dozen futures price is based on their proprietary macroeconomic model, and analysts’ forecasts, of undisclosed weighting. However, their forecast clearly includes a judgmental component, such as egg-laying hen stocks, and projections of bird flu prevalence.

Could egg prices be lower by end-2025 than in January 2025? The ERS forecast 95% confidence interval encompassed a price reduction. I’m dubious, although a miracle could happen with respect to to bird flu (although I suppose we ain’t gonna get a vaccine super-fast with all the cuts to medical research the Trump administration wishes to impose). A catastrophic recession could also push down prices. However, since eggs are a staple — rather than a luxury good — this is hardly seems implausible.

Implications for grocery prices? My guess is that in the 2023 CPI weights, eggs account for about 2.2% of the food-at-home component of the CPI. A 13% December-to-December increase in egg prices accounts for a 0.3 ppts higher food-at-home CPI component.

Addendum: Betting on February egg prices up relative to January.

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