Shelling Out more for eggs

from Mohawk Valley Living #112 March 2023

GREAT FAMILY FUN!

by Suzie Jones

Unless you’ve been trapped under a massive rock these past few months, you have undoubtedly noticed that egg prices in the grocery store are through the roof. And since eggs are an ingredient found in so many other foods, the high price of the friendly ovum has caused grocery and restaurant prices to go up across the board—unhelpful in these times of increased inflation.

But what caused this price spike, and what does it mean for our immediate future?

Root Causes

Feed, fuel, and labor costs all ticked up last year, adding about 10% to overall food prices. But eggs are up about 70% over the same time period. What gives?

The highly pathogenic avian influenza (HPAI) took its toll in 2022, with growers losing or having to cull millions of egg-laying hens—43 million, to be exact. With even more losses in 2023, the current outbreak is the deadliest on record and has surpassed the last one in 2015. Because the outbreaks occurred in waves in the spring and again in the fall, US egg inventories were only about 70% of “normal” just as the holiday baking season arrived.

Supply & Demand

The way the US food system typically works, farmers and ranchers grow just enough to fill the supply chain. Any more, food goes to waste; any less, competitors are more than happy to jump in and fill the gap. It is remarkably—and almost alarmingly—efficient.

More importantly, the largest US producers put eggs into long-term storage, creating a cushion of inventory that makes up for seasonality in laying (the ladies slow down in winter) and increased demand during the holidays (Christmas cookies are a thing, y’all). The size of the cushion, combined with market demand, ultimately determines the price you’ll be paying at the cash register for most eggs.

This explains why eggs hit their peak prices in December and have since cooled off a bit. In January and February, folks weren’t baking massive quantities of cookies like they did in December and higher egg prices caused some consumers to either buy fewer eggs or seek out alternatives. The egg inventory (supply) hasn’t changed substantially, but demand most certainly has.

This also explains why some eggs are suddenly much more affordable—eggs from your local farm stand and some organic or specialty eggs found in the grocery aisle, for example, have not spiked in price simply because they are not part of the vast inventory system. These local, organic, and specialty eggs, while during “normal” times may be on the more expensive side, are priced to reflect actual cost of production and do not include speculative pressures like inventory levels.

What Can We Expect?

We cannot expect egg prices to return to previous levels any time soon, but rather a gradual tempering (barring any serious upsets). Reestablishing flocks and implementing preventative safety measures have been and will continue to be a priority for the big producers. And unfortunately, continued outbreaks of HPAI are to be expected.

Hatcheries across the US are gearing up for the 2023 growing season, with most hatch dates completely sold out due to demand. Prices for chicks have shot up, too, so double check your math if you decide to start your own flock at home—that is, if you can find any chicks at all.

The current egg craze reminds many direct-to-consumer farmers of the early days of the pandemic. When grocery shelves were nearly bare, worried shoppers found themselves at local farms seeking out meats and other items. As the pandemic waned and shoppers found what they needed at the grocery chains, they stopped less and less at their local farm stands and farmer’s markets. In other words, this too shall pass.

How has all of this excitement affected our small farm? We have gotten lots of calls from people we have never met before, some of them willing to drive 45 minutes to save $1-2 on a dozen eggs. Others are hoping to buy by the case-load, thinking we would be happy to sell large quantities at a discount. We politely decline, saving our eggs for the faithful regulars that keep us open year-in and year-out. •