Why the price of eggs is down — and likely to keep falling
Why the price of eggs is down — and likely to keep falling
One of the highlights in the CPI report we got earlier this week: Prices for “food at home” fell for the second straight month – though they’re still well above where they were a year ago.
One item, in particular, may be helping: the price of eggs has tumbled.
The great egg price spike of 2022 and early 2023 seems to be mostly behind us. So what exactly happened?
“This is classic supply and demand,” said Daniel Sumner, a professor of Agricultural and Resource Economics at the University of California Davis. “The quantity of eggs fell, because there was disease and we were trying to deal with the disease.”
That disease Sumner mentioned is bird flu, which hit egg producers hard earlier this year.
“And prices went up … because there was a lower quantity supplied by the market,” he said.
The industry was initially slow to respond to bird flu, according to Sumner, and the virus stuck around a lot longer than anyone expected.
However, cases have dropped in recent months, and egg producers are finally starting to catch up.
“If you look at the wholesale prices, they’ve absolutely collapsed,” Sumner said.
Consumers aren’t seeing all of those savings yet, but the average cost of a dozen grade-A eggs came down more than $1.50 between January and April.
Besides recovery from the bird flu, there’s also a seasonal factor at play, said Marc Bellemare, a professor of applied economics at the University of Minnesota.
“As spring comes in, and as early summer comes in, hens lay more eggs, and then that leads to kind of there is this,” Bellemare said. “There’s this increase in the supply of available eggs on the market, which also puts downward pressure on the price of eggs.”
Cheaper eggs could have a hidden benefit, according to Bellemare.
“As the price of eggs goes down, people consume more eggs, they consume more protein via consuming more eggs, which means that they also consume fewer carbohydrates,” he said.
That, Bellemare said, could have a positive impact on public health.
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