Main egg firms could also be utilizing avian flu as a ruse to hike up costs, producing file earnings whereas hurting American shoppers, new analysis suggests.
The price of a dozen massive eggs hit nearly $5 in January – a file excessive within the US and greater than two and a half occasions the common value three years in the past earlier than the avian flu outbreak. This signifies a 157% inflation fee for eggs – a beforehand go-to inexpensive protein supply for a lot of American households.
And whereas avian flu has been a principal driver of rising client egg costs, the extremely concentrated egg market can also be contributing to the hovering client costs – and the unfold of the virus, in line with new evaluation by Meals and Water Watch (FWW) shared solely with the Guardian.
“Chicken flu doesn’t absolutely clarify the sticker shock shoppers expertise within the egg aisle … company consolidation is a key offender behind egg value spikes,” stated Amanda Starbuck, lead writer of the FWW report The Financial Price of Meals Monopolies: The Rotten Egg Oligarchy.
“Highly effective firms that management each step of the availability chain – from breeding hens to hatching eggs to processing and distributing eggs – are making windfall earnings off this disaster, elevating their costs above and past what is critical to cowl any rising prices.”
The evaluation discovered that in some areas, costs had been going up even earlier than the brand new pressure of the lethal H5N1 virus had affected poultry flocks and diminished egg manufacturing.
The south-east, as an illustration, remained freed from chicken flu in its desk egg flocks till January 2025. In reality, egg manufacturing rose in 2022 and 2023 in comparison with 2021 ranges. But retail egg costs within the area elevated alongside nationwide spikes, in line with FWW evaluation of presidency knowledge.
At the same time as egg manufacturing recovered in 2023, costs didn’t come down. Between April and December 2023, nationwide retail inventories of eggs every month exceeded the five-year common by as a lot as nearly 13%. But the common egg value for shoppers was greater than the five-year common every month.
In a single case, the nation’s largest egg producer, Cal-Maine, boasted a sevenfold improve in gross earnings in fiscal 12 months 2023 in comparison with 2021, after rising costs above rising prices – and regardless of its flocks not being impacted by avian flu throughout that interval.
Cal-Maine, which produces one in each 5 eggs eaten within the US, issued shareholder dividends totaling $250m in fiscal 12 months 2023 — 40 occasions greater than the earlier fiscal 12 months. The Mississippi-based firm offered 7% extra eggs in 2024 in comparison with 2021 and tripled its earnings over the identical interval, in line with firm filings.
A separate evaluation additionally discovered that avian flu alone can not clarify client costs, which rose by 61% over the previous six months, in line with the Bureau of Labor Statistics.
The direct prices associated to dropping hen flocks account for a 12-24% improve in retail costs, in line with a research by the College of Arkansas trying on the impression of the outbreak in 2022-23. (Extra components associated to avian flu – akin to {industry} changes and coverage adjustments – which have possible developed because the research can also contribute to latest value will increase.)
“The working class is struggling to afford groceries whereas firms like Cal-Maine are raking in large earnings and rewarding their shareholders,” stated Democratic congressman Ro Khanna. “The Trump administration has the facility to decrease grocery payments, however as a substitute they’re imposing blanket tariffs on allies, firing federal employees who’re making an attempt to stop the chicken flu, and placing billionaires over strange Individuals.”
Cal-Maine didn’t reply to requests for touch upon the findings.
Nationwide, 166 million poultry have been culled because the virus started spreading via industrial flocks in early 2022. There have been 9% fewer egg-laying hens in January 2025 in comparison with three years earlier, in line with US Division of Agriculture (USDA) figures.
The overwhelming majority of avian flu outbreaks have been on manufacturing unit farms the place a whole bunch of 1000’s or typically hundreds of thousands of egg-laying hens are caged in shut proximity, creating perfect circumstances for the fast unfold of infectious illnesses.
In February, an outbreak was detected in a flock of just about 3.1 million egg-laying hens in Darke county, Ohio, in line with USDA knowledge. If one hen is contaminated, federal laws name for the complete flock on the affected web site to be killed – because of the dangers posed by the lethal and extremely contagious virus to different poultry, animals and people, additional disrupting provide and rising prices.
“These similar firms exacerbate the chicken flu outbreak by elevating their birds on manufacturing unit farms, crammed collectively in a whole bunch of 1000’s or hundreds of thousands, creating the proper breeding floor for illness,” stated Starbuck.
Up to now 70 human circumstances have been confirmed within the US. One individual has died and one other three have required hospital therapy. Virtually 1,000 cattle herds have been contaminated, and the virus has been detected in poultry in nearly each single US territory.
Greater than 54 million birds have been affected up to now three-months.
The egg manufacturing {industry} – just like the retailer sector that producers largely promote to – is extremely concentrated. This provides a handful of massive firms the chance to affect costs exterior the impression of shocks like avian flu and the Covid 19 pandemic on provide and demand.
The highest 5 egg firms personal nearly half (46%) of all egg-laying industrial hens. Headquartered in Mississippi, Cal-Maine is the one publicly traded US egg producer, and has 75% extra hens than the subsequent largest firm.
Cal-Maine didn’t expertise any chicken flu outbreaks in its flocks in its 2023 fiscal 12 months – and really offered extra eggs in 2023 than within the earlier two years. But the corporate nonetheless offered standard eggs at inflated costs – 2.8 occasions greater in comparison with 2021, pocketing nearly $1 extra a dozen even after considering bills akin to feed and power.
This helped the corporate extract simply over $1bn in “windfall earnings” after accounting for manufacturing, processing and transport prices.
In its monetary paperwork, Cal-Maine suggests egg costs are exterior the corporate’s management: “We don’t promote eggs on to shoppers or set the costs at which eggs are offered to shoppers.”
However a lot of its clients depend on Cal-Maine for almost all of their egg wants, in line with firm filings, so the value it sells its eggs issue into grocery retailer costs.
Patrons seem to rely closely on a single {industry} knowledge analytics agency, Urner Barry, which crunches knowledge from firms throughout the availability chain to create its each day value benchmark for eggs. In flip, producers use the benchmarks for setting their egg costs on the market to retailers – although they aren’t required to.
In different phrases, Urner Barry’s indices work like a suggestions loop that may artificially drive up costs and hurt shoppers, in line with earlier lawsuits.
In accordance with {industry} commentator Simon Shane, “the established relationship between producers and chain consumers [major retailers] primarily based on a single industrial value discovery system [the Urner Barry index] constitutes an obstacle to a free market”.
An Urner Barry spokesperson stated there was no single industrial value discovery system or industry-wide pricing system within the egg {industry}. “We’re one supply of knowledge for consumers and sellers, selling transparency out there by collating correct historic transaction knowledge. Patrons and sellers are at all times free to transact at completely different costs. Completely different contracts are agreed between completely different consumers and sellers utilizing completely different formulation.”
Cal-Maine’s hovering earnings doesn’t mirror the complete {industry}. There aren’t any publicly accessible monetary information for different main producers.
Last month, a farmer-led advocacy group urged federal antitrust companies to look into whether or not potential collusion could possibly be exacerbating value hikes. Farm Motion additionally known as on the Division of Justice and the Federal Commerce Fee to analyze whether or not main egg producers have been slower to exchange misplaced hen flocks in comparison with the 2014-15 avian flu outbreak, with the intention to suppress provides and preserve costs excessive.
Virtually 631m eggs had been produced in January 2025 – practically 10% fewer than January 2022, as flock sizes proceed to drop. The USDA tracks pullets – the chicks hatched to exchange egg-laying hens – which have been under the five-year common most months because the outbreak started in February 2022.
“Based mostly on publicly accessible knowledge, we’ve noticed that egg value will increase far exceed what could be anticipated primarily based on hen losses and the {industry} has not elevated the variety of laying hens as anticipated throughout a interval of excessive costs. This strongly suggests potential antitrust violations,” stated Angela Huffman, chief government of Farm Motion. “The FTC and DOJ have the authority to analyze past what’s publicly accessible … we urge them to train this authority.”
Whereas shoppers have been harmed by rising costs, there isn’t a proof of collusion, in line with Bruce Babcock, professor of public coverage and an knowledgeable on agriculture economics on the College of California, Riverside. “The truth that different very massive egg producers needed to euthanize tens of hundreds of thousands of birds meant that CalMain advantages as a result of the value of eggs went up and Cal-Maine can get a windfall revenue … That’s how markets work.”
In 2024, 94% of Individuals stated they had been very or considerably involved about the price of meals and client items, in line with Pew Analysis Centre. In January 2025, households throughout the nation had been once more dealing with surging egg costs – even in areas the place inventories remained secure, FWW discovered.
In a letter despatched to the White Home, Rep Khanna was amongst greater than 20 Democratic lawmakers, together with senator Elizabeth Warren, who urged Trump to make good on his marketing campaign promise to convey down grocery costs and examine potential value gouging by firms which might be raking in file earnings.
“Egg producers and grocery shops could leverage the present avian flu outbreak as a chance to additional constrain provide or hike up egg costs to extend earnings,” the lawmakers wrote. “The egg firm [Cal-Maine] and its shareholders are making greater earnings whereas Individuals shell out extra for grocery staples.”
On Thursday, agriculture secretary Brooke Rollins outlined the Trump administration’s 5 level technique to decrease egg costs. This contains investing $1bn in curbing avian flu – which she stated could be partly funded by working with Elon Musk’s group “to chop a whole bunch of hundreds of thousands of {dollars} of wasteful spending”.
Federal worker layoffs and public well being blackouts measures have already disrupted monitoring, testing and messaging for avian flu.
The agriculture secretary additionally signaled plans to maneuver away from culling complete flocks, the depopulation measure at present mandated, in favor of latest vaccines and biosecurity measures like improved protecting gear and procedures. The administration is contemplating briefly permitting egg exports and claimed California laws that requires minimal house for egg-laying hens, is driving up manufacturing prices, Rollins added.
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