Inflation is affecting so many parts of our daily lives right now, and one of the most recent products to see soaring prices are eggs. Supply chains are complex, and they involve everything from how chickens are fed and raised to shipping, but there are some general factors that explain at least a few of the key reasons why eggs are incredibly expensive right now.
December 2022 saw record prices for eggs, and they’re starting to come down a bit from those highs, but analysts say it could take some time to see any differences at the store when you’re actually buying this staple item.
All grocery items have essentially gotten more expensive, but eggs have been the most significantly affected by inflation.
So why is that?
One reason is that eggs are an ingredient in other foods and meals, but they’re also a product of other sources of food.
In November, according to the Consumer Price Index, the price of eggs was up 49% compared to the year before.
Egg prices were an average of $4.63 recently, although they were down from $5.46.
That means eggs are currently more than a gallon of gas in a lot of parts of the country.
The benchmark for egg prices is Midwest large eggs. In January 2022, a dozen Midwest large eggs cost an average of $1.50. In January 2021, they were around $0.94.
This is compared to grocery prices on a broad level, which went up 12% overall last year, meaning eggs were the highest increase in any one particular food category in the entire grocery store.
It’s somewhat startling to look at those numbers.
Egg prices are something that grocery shoppers really pay attention to and feel because they’re a known value item, meaning people often know the typical prices when they go to the store. It’s similar to a loaf of bread or a gallon of milk.
What’s the Reason for Soaring Prices?
One of the biggest reasons for the rising egg prices is an outbreak of the bird flu.
A very contagious form of the avian flu spread around the world last year, and just in the U.S. alone, major egg producers lost millions of their birds. Flocks that were infected had to be depopulated in order to slow the viruses spread.
That led to around 58 million birds dying, according to the U.S. Department of Agriculture. That number included more than 40 million hens that lay eggs.
There were hundreds of commercial flocks affected just in Iowa, which is the top producer of eggs in the U.S.
It was January of last year when the first bird flu hit the U.S., and the cases really soared in spring. Then, another wave hit late last year. It was more impactful than a 2015 avian flu outbreak that killed 50 million birds and also led to a spike in the prices of eggs.
Along with the deadly avian flu, there are other pressures that are leading to inflation across the board, including higher feed costs and higher prices for transportation and energy, plus the fact that we’re coming out of a period of increased holiday demand.
To combat the soaring prices, some people are soaring eggs locally from backyard suppliers.
Experts and analysts say they think the prices of eggs are going to remain high until the flu is under control, meaning the record-setting prices may be sustained.
The CDC has been releasing guidance on how infection can be prevented between birds.
Despite Soaring Egg Prices, Chicken Prices Are Falling
Interestingly, if you’re the person responsible for doing the grocery shopping in your family, you may have noticed that chicken prices have been dipping a bit, even in the face of massive increases in egg prices. This initially seems counterintuitive, but there’s a reason.
The avian flu has killed a large share of egg-laying birds, but not the ones that are raised for meat consumption.
The wholesale price of chicken breast, as an example, has gone below $1.20 a pound, while it peaked over the summer at around $3.60.
The chickens that are raised for meat consumption are produced differently, and the breeds of birds are also different. Birds raised for consumption are known as broilers, with a much shorter lifecycle from their hatch to their slaughter. Since egg-laying birds are kept alive longer, it’s more likely they’re going to catch the avian flu.
Finally, even though the prices are coming down, even for broilers, chicken prices are still up more than 14% since October 2021.