Eggs are no longer the cheapest source of animal protein

Published 6:00 am Saturday, July 25, 2015

WASHINGTON — Anyone who hasn’t noticed that eggs are getting more expensive these days either doesn’t buy eggs or doesn’t bother to look at prices when buying groceries.

Because they are getting much more expensive.

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The price index for eggs, which tracks the average national increase people have to pay, rose by almost 20 percent in June alone, on the heels of one of the worst egg crises this country has ever seen. The single month spike is the largest we have endured in more than 30 years, according to the U.S. government.

And it rivals almost any we have seen dating back to the 1960s.

The upticks in the average price we have to pay to buy eggs at the supermarket follows striking increases in the wholesale price of eggs over the past few months. The price that retailers pay farmers for eggs has more than doubled, both for eggs sold in liquid form (a.k.a egg beaters, the kind used by large food manufacturers) and eggs sold in shell, since April.

The reason egg prices are out of wack dates back to December, when a yet unfamiliar virus was first discovered in Washington State. For months, the avian flu lay somewhat dormant, spreading slowly, leaving egg supplies virtually untouched. But then in April the flu caught fire, causing chicken farmers around the country to kill off entire flocks. At present, some 50 million birds have been affected, according to the USDA. And all of them have had to be killed in order to mitigate the virus’ impact.

The problem for the egg industry is that roughly 35 million, or just over 70 percent, of the birds that have been infected, were or are egg laying hens. The consequence should be rather obvious: the egg industry has suffered the brunt of the pain. Dwindling supplies, due to the sudden killing of nearly 12 percent of the 300 million-plus egg laying hens in the United States, has coerced some supermarkets to limit egg purchases. It has also forced farmers to charge more for fewer eggs and retailers, in turn, to pass some of the increase on to people like you.

Another way to understand the disproportionate impact the flu has had on the egg industry is to consider this: Eggs are no longer the cheapest source of meaty protein — chicken breasts are. David Yanofsky of Quartz noted the change over the weekend, after pitting the average price of protein found in each against one another.

If and when egg prices settle back to normal will depend on when the virus dies down, and whether it withers away for good. “Prices won’t normalize until farmers can replenish their flocks,” said John Newton, who teaches agricultural economy at the University of Illinois. “But flocks can take something like 100 days to replenish.”

The avian flu has slowed recently, likely due to hotter temperatures, but some expect it could return this coming fall or spring, a scenario which would likely extend the period of higher egg prices.

There was, for a time, a sense that the price people pay at checkout might not jump the way it has for distributors behind the scenes, but that time has come and gone. Egg distributors and food retailers, facing a shortage of supply and uptick in costs, could only wait so long before adjusting their own tags. Now we’ll get to see whether Americans are wiling to stomach prices as they inch skyward.