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One of the most mysterious foodstuff price manipulation stories of 2022/2023 has been affecting egg prices in the U.S. At this time in 2021, eggs were $1.78 a dozen, in 2022 they were $1.93 a dozen, and today they are persistently at around $4 a dozen. What interesting and peculiar is that egg prices have rarely been rising (at least, at a similar pace) elsewhere. For example, the Philippines saw the Bonus brand (Bounty Fresh Farms) dozen eggs’ retail price decline from 125 pesos in January to today’s 110 pesos per 12-egg box.

Egg prices across the country hit record levels prices in 2022 as they are selling for more than twice the median price from 2021 ($1.78). The avian flu started back in February 2022 with Iowa, the largest egg producer in the U.S., hit the hardest, and before it spread to 47 other states. In 2015, the previous avian flu outbreak impacted 21 states, and 50 million birds were culled as a result of containing the spread of the flu and were, at the time, the most serious animal health event according to a USDA report.

Meanwhile, the recently published data, extracted from the U.S. Consumer Price Index (CPI) showed that egg prices in January 2023 were up a whopping 70% from January last year and 8.5% from December.

Despite the rise in egg prices, consumers can hope for some relief as a report from the USDA showed that wholesale egg prices fell on a weekly basis. As it is often quoted in the mainstream media, the high prices in 2022 are largely attributable to outbreaks of bird flu, which affected 58 million chickens as of January, according to the USDA.

Farm Action, an advocacy group critical of large agribusiness groups, however, recently sent a letter to the Federal Trade Commission (FTC) in January asking it to investigate “price gouging” and “price coordination” by egg suppliers, including Cal-Maine Food and Rose acre farm.

Meanwhile, U.S. egg producers have reported a 40% rise in profits last year and blamed them for turning bird flu and inflation into “getting an opportunity of a quick enrichment”, Farm Action reported.

Cal-Maine Foods, one of the largest egg producers in the U.S., has denied the allegations, saying rising labor, chicken feed, and fuel costs, and bird flu have contributed to higher egg production costs. Indeed, the flu has wiped out more than 44 million laying hens, or about 4% to 5% of production, according to the USDA. However, prices are rising much faster.

Looking back, egg prices hit record highs ahead of the December holidays, when demand for eggs surged. But even a slight drop in recent weeks means U.S. buyers are starting the year with well-above-average costs. In California, the most expensive market, shoppers paid an average of $7.37 for a dozen large Grade A eggs, about three times the price a year ago.

Outline and Forecast: According to SalemNewsOnline, eggs over the past couple of decades became a sort of emergency alert pointing to inflation is out of control. Thus, the U.S. national average price of eggs shows a concerning trend in egg prices even before the avian flu outbreak. Federal Reserve Economic Data (FRED) shows a steady increase in price since 2001, with a few peaks, culminating in a sharp spike in 2022. Prior to 2022, the average price did not break $3. During the economic recession of 2008, the average price of eggs peaked at $2.20.

With prices of regular eggs having skyrocketed, the price of specialty eggs has increased even more. The price of a dozen extra large Eggland’s Best eggs sits at $5.47 at Walmart. Still, in terms of the accuracy of eggs’ price prediction for the rest of 2023, there is a unity of opinions between the farmers and analysts, that much will depend on how well avian flu is contained. But eggs might remain hyperreactive to overall inflationary trends. Fed officials have stressed the need for further rate hikes to curb inflation but expressed mixed views on how close they are to a halt after new data showed signs of persistent price pressures. Several officials said, on February 14, that interest rates may actually require to rise higher than expected to ensure that inflation is de facto contained. Richmond Fed President Thomas Barkin also suggested that “If inflation continues to run well above the agreed upon the target, the U.S.central bankers may “need to do more,” while Philadelphia Fed President Patrick Harker said he thought policymakers… Interest rates need to be raised above 5% and possibly higher to offset inflation.

That means the cost of eggs is expected to remain high, at least in the short-to-medium term. The immediate outlook is particularly high, but that prices will come down a bit as producers ramp up egg production and packaging.

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