Why Are Egg Prices Cracking? Market Shifts and Seasonal Demand Spell Big Changes for Shoppers

ByPasarextra

Shoppers at grocery stores have had to hustle due to persistently elevated egg prices.

When the price of Grade A eggs reached an all-time peak of $5.90 per dozen in February, many shoppers found themselves caught off guard. This marked the most expensive egg prices ever recorded, almost doubling compared to the prior year’s costs.

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There might finally be some respite coming, as the cost of eggs at the wholesale level has begun dropping.

However,

Easter

There might be a delay between adjustments in wholesale costs and consumer prices, which could imply that relief won’t arrive right away for annoyed supermarket shoppers. Many of these individuals have been grappling with elevated food inflation since the start of the pandemic.

Here’s what’s causing the drop in egg prices recently

The cost of eggs reached record highs because of a lethal avian influenza outbreak that swept through the U.S., leading to the deaths of millions of laying hens. This situation was possibly exacerbated by suspected anti-competitive practices among large producers, which led to an ongoing antitrust probe conducted by authorities.

Department of Justice

in March.

The positive development is that occurrences of avian influenza seem to be happening less often. Moreover, elevated costs have diminished their impact.

consumer demand

Many individuals are opting out of buying eggs because of historically high costs. Additionally, some consumers, worried about potential price hikes resulting from ongoing avian influenza outbreaks, engaged in egg hoarding, which reduced future demand even more. As a result of increased supply and decreased demand, prices have started to decline.

“The slowdown in outbreaks has resulted in better supply availability, causing wholesale market prices to sharply decline over the last week,” according to the USDA.

The drop in wholesale egg prices has been significant, with the cost per dozen dropping 44% from its mid-February peak. Wholesale prices are now $4.83 per dozen instead of $8.58 per dozen, according to Expana, which tracks agricultural commodity prices.

Karyn Rispoli, an egg market analyst and the managing editor at Expana, informed CNBC through email that the prices had dropped sharply because of market conditions exerting “significant pressure” on the price per dozen.

The Trump administration launched an initiative aimed at lowering costs, which involved allocating $500 million for enhancing biosecurity measures, offering increased compensation to farmers through higher indemnity payments, easing regulatory burdens, and boosting egg imports to augment supplies.


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Customers might not notice reduced costs at this point.

Although the lower wholesale price is positive, it does not guarantee that consumers will see more affordable eggs anytime soon.

Rispoli mentioned that generally, there’s a delay of about two to three weeks from when wholesale prices shift until they lead to a decrease in retail prices. Additionally, retailers do not always promptly modify their pricing to align with these changes.

wholesale fluctuations

This implies that shoppers might still experience the impact of high costs when purchasing eggs.

Consumers have seen
some
Relief. U.S. Secretary of Agriculture Brooke Rollins said, “Since we unveiled our strategy, the price for a dozen eggs has decreased by $1.85 on average.”

Nevertheless, this downward price trend isn’t anticipated to persist over the short term. Prices are predicted to climb once more around Easter, when the demand for eggs historically surges. The Easter period usually boosts the demand for eggs due to customary practices such as coloring Easter eggs and using boiled eggs in numerous Easter dishes.

Fingers crossed that after Easter, the initiatives taken by the Trump Administration along with the decreasing frequency of avian influenza cases might result in sustained decreases in egg prices. This would enable shoppers to purchase eggs for their homes without worrying about straining their finances.

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The content of this article serves solely as information and should not be interpreted as guidance. It comes with no guarantee or warranty whatsoever.