Washington Monthly - Unscrambling the Price of Eggs

Food systems program manager Claire Kelloway explores how the recent rise in egg prices is driven not just by factors like bird flu, but also by corporate greedflation and potential corporate collusion manipulating the market.

The fate of the nation, as we have all learned, hangs on the price of eggs. But have you noticed that the price of eggs—which might finally be coming down—has risen much faster for some eggs than others? In the past, if you went down to your farmers’ market and bought eggs laid by local free-range hens living under humane conditions, you had to pay a big premium. But now, if you go to Walmart or Kroger and buy conventional eggs produced by caged hens on supposedly super-efficient industrial-scale farms, you are likely to pay just as much or even more. 

How can this be? Part of the answer lies with the bird flu outbreak, which has affected different kinds of poultry operations differently. But another factor appears to be just as important: corporate conclusion and resulting greedflation. 

There is no doubt that bird flu has played a significant role in driving up the cost of all eggs. Wild birds brought a particularly contagious strain of bird flu to the U.S. in 2022, and egg farmers have struggled ever since to protect their flocks. When farmers find a single case of bird flu, current federal policy requires that they kill their entire flock. Since 2022, farmers have killed more than 120 million egg-laying hens. That loss of supply naturally drives up prices. 

But there is a lot more going on. To start, why has the price of conventional, industrial-scale, caged-bird eggs increased much more than the price of cage-free eggs? For example, the average retail price for caged-bird eggs rose 140 percent from December 2021 to December 2022, while average retail price for cage-free eggs rose just 41 percent during this time. 

One factor is that cramming thousands, in some cases millions, of chickens into confined indoor spaces creates the perfect breeding ground for spreading and evolving zoonotic disease. So it should be no surprise that the biggest bird flu losses have been concentrated among a few massive farms with more than a million birds each. 

By comparison, most cage-free or pasture-based egg farms house fewer birds per farm. When an outbreak occurs, fewer hens must be preventively destroyed. Less concentrated production means less concentrated risk. 

But that’s not the whole story. The greater hen losses in caged-egg production still cannot account for how much caged-egg prices have risen. In the past, when egg supply contracted, prices went up at a comparatively modest rate. According to the agriculture economist Jayson Lusk, a rule of thumb in the egg business is that a 1 percent decrease in supply will typically result in a 6.6 percent increase in prices. This held true for the last bird flu outbreak in 2015: Prices rose roughly 7 percent for every 1 percent decrease in supply. But prices rose much more this time around. An analysis by Hunterbrook Media found that between 2022 and 2024, for every 1 percent decrease in egg production, prices increased by anywhere from 17 percent to 33 percent. 

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