Yes, Egg Prices Are Still Up, but its Not Because of Inflation

Eggs are one of the most ubiquitous foods in the world. A breakfast staple in many cultures and an important ingredient in many cuisines, eggs are nutritious, flavorful, and versatile. Unfortunately, they are also becoming one of the most expensive items on your grocery list. That is because egg prices are soaring, their trajectory does not appear to be stopping any time soon, and it is not simply a matter of inflation.

While egg prices hit a peak—during the 2022 holiday season, they are still significantly higher than in previous years. More importantly, the higher sourced egg prices lead to higher egg prices in the grocery aisle and in food service establishments. And even if you do not eat eggs outright, they are an ingredient in other food staples (like baked goods), meaning this higher expense can affect just about anyone, anywhere.

Increased holiday demand could have contributed to the price spike—especially as it seems to have ebbed—but higher consumer demand is not the only cause for such steep price increases. An avian flu outbreak in February 2021 claimed about 40 million hens in the United States. That is equivalent to about five percent of the entire US flock, as a US Department of Agriculture spokesperson described. This has contributed to a reduction in egg production; it has declined by about 4 percent since 2021.

For some, the price increase may feel not only massive but sudden. This is somewhat by design. For one, as a staple grocery item, consumers have continued to buy eggs over the last two years, regardless of incremental increases that could have gone somewhat unnoticed. And those who may have noticed it adjusted for it because eggs are such a crucial item.

Secondly—and perhaps most important—many grocery chains use eggs as one of their “loss leaders.” This discounted pricing strategy artificially lowers the price of a particular good in a way that results in a loss for the store, attracting shoppers who then buy other items at a higher profit margin. So it is not that egg prices are “higher”, necessarily, but that we may be paying closer to their actual cost than we were before.