Inflation, increased transportation costs, a sudden decline in output, and avian flu were all blamed by suppliers for a sharp increase in the price of eggs.
Due to drastically increased egg prices, the biggest U.S. producer, Cal-Maine Foods, saw its revenue last quarter more than double to over a billion dollars, and its profits jumped by 718%. And there was no slowdown in output. According to CNN, the number of eggs sold by Cal-Maine, which has a roughly 20% share of the domestic market, increased by 1%.
In the quarter ending on February 25th, the firm reported that the average selling price of a dozen eggs was $3.30. Cal-Maine said the average cost of a dozen was $1.61 a year ago, more than double the current price. CNN stated that as a result, net income increased to $323.2 million from $39.5 million in the prior year.
For the first time since the U.S. Bureau of Labor Statistics (BLS) started collecting this information in 1980, the price of a dozen eggs in January was higher than that of a pound of beef. According to the BLS, the average pound of the ground beef cost was $4.64 in January 2023, while a dozen significant Grade A eggs cost $4.82. According to the agency, the price of an egg has increased by 70 percent in the last year, from $1.93 in January 2022 to $4.77 for a similar cut of beef.
Among the most prominent U.S. egg producers, there exists “a collusion” to control prices and fleece consumers, as claimed by Farm Action, a farmer-led advocacy organization. Farm Action said in a letter to the FTC in January that egg farmers had been able to “extract exorbitant profits reaching as high as 40%” due to the alleged conspiracy.
Bird flu is not to blame, according to the letter. Examining publicly accessible financial data from the egg business, the supply interruption caused by the avian flu pandemic had a very modest effect on the sector.
Farm Action said that the egg industry is booming. Cal-gross Maine’s earnings increased from $50.392 million to $535.339 million and by a factor of five from its gross margins over the 26 weeks ending on November 26, 2022.
Several legislators have complained about the high cost of eggs and accused the industry of price gouging.
