by - Egg prices have skyrocketed in the past year as a result of the deadly bird flu.
- However, prices will never really be the same, especially as the US transitions to cage-free eggs.
- Some estimates suggest that in four years, 70% of hens could be laying cage-free eggs.
Eggs – a delicious breakfast or financial headaches in the past year.
A highly pathogenic bird flu, which killed 58 million birds, is largely to blame for record prices. High feed costs and inflation also played a role.
However, with herds recovering and egg price breaks looming, the days of the $1 egg carton could be over as cage-free, ethically sourced eggs become a new reality in the US.
David P. Anderson, an expansion economist at Texas A&M, told Insider that the switch to the new production system will come with production costs that will eventually impact supermarket prices.
“We’re so focused on the short term, ‘Oh, we have this disease,'” Anderson said. “But there’s also that underlying long-term part in there. That’s pretty important.”
The trend towards ethical eggs
Most of the eggs in the country are produced by factory farms that stuff thousands of laying hens into battery cages — stacked metal containers with little room to move. They live in one place, constantly produce eggs, eat and sleep in their own feces and dust.
Animal rights activists say it’s inhumane, and voters and businesses have reacted.
In 2016, Massachusetts became the first state to mandate that eggs sold in stores must come from farms that meet certain standards of care, including cage-free environments. Hundreds of companies like Walmart and McDonald’s have also pledged to phase out cage eggs.
The changes in egg production between several states resulted in additional construction costs, higher feed costs, and higher labor costs. Cage-free methods could also result in lower egg yields.
CNBC estimated that farmers across the country would need at least $6 billion to build cage-free housing that would meet demand through 2027.
“It costs more money to produce a dozen eggs in a cage-free environment or using any of these other methods,” Anderson said. “As more of the industry tries to comply with these regulations, the prices will go up.”
During the bird flu-related price increases from February 2022, the price gap became clear. In states like California, whose cage-free mandate went into effect in January 2022, prices for a dozen eggs rose to nearly $6 in December, while prices in many other states have hovered around $4 to $5.
Other factors, such as the concentration of egg production in the Midwest, which resulted in higher transportation costs, also played a role, Anderson said.
Cage-free eggs are what consumers want, but the “sticker shock” could put buyers off
Despite the higher price, cage-free is the country’s goal.
According to the Associated Press, between 2010 and 2020, the proportion of hens kept in cage-free housing increased from 4% to 28%. In four years it could be 70%.
Fourteen states have already passed laws banning cage farming and nine states have passed laws banning the sale of battery cage eggs. The US Supreme Court is currently reviewing the constitutionality of Proposition 12, the cage-free law passed in California.
However, higher prices can sometimes discourage consumers from buying.
Consumer demand for eggs is currently lower than this time last year. This could be a case of sticker shock, Anderson said. It may also shed light on how consumers might react to egg price increases in the future.
“As prices have gone up, people have really become aware of what it costs,” Anderson said. “And they change what they’re buying a little, like, ‘Gosh, you know, we’re buying fewer eggs.'”
