Egg prices have experienced a notable recent decline, bringing significant relief to consumers after a period of unprecedented highs. This market correction reflects a complex interplay of factors, from shifting consumer behavior to the lingering effects of widespread disease.
Significant Price Drop Follows Peak Volatility
The recent volatility in egg prices has been stark. Early in the year, a dozen large white shell eggs could be found for around $6.49. By the first week of March, prices soared even higher, exceeding $8 per dozen. However, recent data from the U.S. Department of Agriculture (USDA) indicates a dramatic shift, with national average prices plummeting to approximately $2.52 per dozen. This represents a steep drop of over 60% from their March highs.
Factors Driving the Decline
This sharp reversal in egg prices was primarily fueled by two converging factors: a noticeable reduction in consumer demand and a slowdown in new cases of avian influenza. As prices surged, over 30% of American consumers reportedly curtailed or ceased their egg purchases due to the exorbitant costs, according to an April study by Clarify Capital. This significant drop in demand, coupled with a lull in the bird flu’s spread, contributed to the market’s rebalancing.
The Persistent Shadow of Avian Influenza
Despite recent improvements, the impact of the highly pathogenic avian influenza (HPAI) outbreak continues to pose a significant challenge to the poultry industry. Since its onset in 2022, the virus has decimated nearly 170 million domestic birds, including approximately 127 million egg layers. This has resulted in an average annual loss of 42.3 million egg layers, roughly 11% of the typical annual inventory, as calculated by Bernt Nelson, an economist with the American Farm Bureau Foundation. The USDA’s Animal and Plant Health Inspection Service (APHIS) confirms ongoing outbreaks in numerous states, impacting layer flocks.
Market Adjustments and Future Outlook
To bolster domestic supply amidst these challenges, the United States strategically increased its imports of eggs from international partners such as Turkey, Brazil, and South Korea, as reported by Reuters. Despite the current relief for consumers, the USDA projects that egg prices could surge by over 40% in 2025, indicating that the market remains susceptible to future supply shocks and demand shifts.
The recent journey of egg prices from record highs to a significant drop underscores the delicate balance between consumer behavior, disease outbreaks, and global supply chain responses.
Sophia Patel brings deep expertise in portfolio management and risk assessment. With a Master’s in Finance, she writes practical guides and in-depth analyses to help investors build and protect their wealth.