Higher egg prices are the new normal in 2023
Friday, January 20, 2023
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Record-high egg prices are making headlines right now, but when can consumers expect some relief? Oklahoma State University Extension specialists say several factors are to blame for the significant price spike, and the sticker shock is expected to continue through the first quarter of 2023.
“At this time in 2021, eggs were $1.47 a dozen, in 2022 they were $1.93 a dozen and today we’re still at $4 a dozen,” said Rodney Holcomb, OSU Extension specialist in food economics. “The line chart just goes straight up.”
Data from the U.S. Department of Agriculture shows egg prices typically jump during the holiday season, and the cost of eggs has historically increased during times of economic strain such as the recession in 2008 and the spread of COVID in 2020. However, today’s record prices reflect the nationwide impact of Highly Pathogenic Avian Influenza and a booming demand for egg consumption.
“In the food research I did 30 years ago as a grad student, eggs were always the lower-cost animal protein option,” Holcomb said. “They were a good protein source that was available, cheap and easy to fix. Over the past couple of years, as the price of beef, turkey, bacon and chicken skyrocketed, people chose to eat more eggs.”
In states where HPAI decimated commercial poultry flocks in 2022, the demand for laying hens outpaced egg supplies. Holcomb said it takes time to rebuild those operations.
“The price of chicken also went up last year because of avian influenza, but the rebound is faster for broilers,” he said. “It only takes about six weeks to go from a hatched chick to a broiler that’s ready for market. With laying hens, it takes months for them to grow to sexual maturity, start laying eggs and provide a consistent supply at peak production.”
The worldwide phenomenon of egg consumption also relies heavily on the fact that eggs are an essential ingredient in many prepared foods. While eggs are more budget-friendly than beef, pork, turkey or chicken, the rapid climb of egg demand in 2022 does not run parallel to a price hike in other markets.
Derrell Peel, OSU Extension livestock marketing specialist, said retail beef prices are 2.4% lower than they were a year ago and have remained steady for the past 15 months.
“There is no doubt of some substitution of eggs for other proteins, although I don’t believe it to be a major factor,” Peel said. Eggs are well established as a breakfast item and are complementary for meats like sausage and bacon. Higher egg prices are more likely due to supply issues than those that are demand driven. In 2022, 44.4 million layer chickens were depopulated because of avian influenza. I expect that is the major driver of higher egg prices.”
Holcomb said inflation across the board will influence the 2023 egg price outlook because the egg industry’s new normal is yet to be determined. Higher fuel, feed and fertilizer costs as well as additional avian influenza outbreaks could potentially increase prices. Holcomb hopes for a steady decline but said prices are going to be higher than expected through the second quarter of this year.
“It’s still a relatively inexpensive protein source, but you’d have to get back down to the $2.50 to $3 range per dozen just to be somewhere in the same category as an inflation-adjusted normal price relative to every other food product,” he said.