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Egg Prices, Consumption and Production in Flux in Aftermath of Avian Flu

On this, everyone can agree: last year’s avian flu outbreak was a disaster for producers and consumers. And I think everyone can also agree that it is a good thing the disease has not resurfaced thus far this year. However, a year removed from the outbreak, things are starting to change for consumers and producers.

Cal-Maine posted its sales figures for the three months ending in August, and the numbers were pretty drastic compared to the year-ago period: selling prices dropped 58% for regular eggs, and specialty eggs dropped 20%. Overall, the company posted a loss of $30.9 million during the period. According to CEO Dolph Baker:

“As the supply of shell eggs moved higher after the disruptions created by the Avian Influenza outbreak in the spring of 2015, market prices declined … Retail demand remained favorable; however, lower institutional demand for egg products and reduced egg exports pushed inventory levels higher and created additional pricing pressures.”

Supply seems to be playing a big role in the declining prices. According to USDA’s National Agricultural Statistics Service (NASS), U.S. egg production jumped 10% in August 2016 when compared to the same period in 2015. The nation’s total egg production rose to about 8.6 billion during the time period, with table eggs accounting for about 7.4 billion of that total.

However, supply isn’t the only thing changing: since dietary guidelines changed to remove the cholesterol warning associated with eggs, U.S. consumption has risen. According to the American Egg Board, per capita consumption in the U.S. rose to 265 in 2016, up from the 252.9 posted in 2015 and the 258.1 posted in 2006.

Will the trend continue? Almost definitely so. However, how far will egg prices drop? You can be sure we’ll keep an eye on this story in the months to come.