While Americans have gotten used to sticker shock over the past year as prices for food, gas and other everyday items surged, many did a double take when buying a couple of eggs lately. The average price for a dozen Grade A large eggs reached $4.25 last month according to the U.S. Bureau of Labor Statistics, up from just $1.79 twelve months earlier. According to the latest CPI reading, egg prices rose by nearly 60 percent between December 2021 and December 2022, far outpacing the price increases seen for other food staples.
So what’s behind the “eggflation” crisis that has even caused a surge in illegally imported eggs from Mexico, where prices are significantly lower? Aside from inflationary pressures hitting food prices across the shelve, egg prices have additionally been affected by a severe bird flu outbreak, which disrupted egg supply in 2022. According to the U.S. Department of Agriculture, U.S. farmers lost more than 40 million laying hens to HPAI (highly pathogenic avian influenza) last year, resulting in a mid-single-digit percentage decline in total egg production. And because eggs are hard to substitute, relatively small declines in supply have a large impact on prices, resulting in the latest surge.
Like oil and gas companies seeing profits surge during the energy price crisis, there have also been some winners of the egg price surge. Some eggs producers that have barely been affected by the avian flu have reported record profits in 2022, leading to renewed calls for a windfall profits tax.