Egg prices have reached new heights in recent months, with the cost of a dozen eggs in the U.S. climbing to record-breaking figures.
As of February 2025, wholesale prices exceeded $8 for a dozen white eggs, a figure that, although slightly decreased since then, continues to impact consumer costs at the grocery store.
The dramatic rise in prices has led to widespread concern and confusion. While many assume that economic principles like supply and demand are at play, a closer examination reveals a more complex situation—one influenced by disease outbreaks, market dynamics, and consumer behaviour.
The Avian Flu and Its Impact on Supply
The main factor contributing to the rise in egg prices has been a significant decrease in supply due to avian influenza, also known as bird flu. According to Jada Thompson, an agricultural economist from the University of Arkansas, the disease has affected poultry at unprecedented levels, with mortality rates among egg-laying birds reaching as high as 90%.
The result has been a loss of approximately 50 million laying hens since late 2024. This drastic reduction in supply has caused severe disruptions in the egg market, contributing to the soaring prices.
In addition to the death toll from the virus, many of the remaining birds have been culled to prevent further spread of the disease, further reducing the overall supply of eggs.
The industry is struggling to recover, with young birds—critical to replenishing the stock—being impacted as well. Emily Metz, CEO of the American Egg Board, noted that the recovery process has been much slower than expected, exacerbating the supply shortfall.
High Demand and Consumer Buying Behaviour
On the demand side, the situation is equally compelling. Despite the rising prices, the demand for eggs has remained high, driven by both regular consumption and seasonal factors.
According to Emily Metz, the egg industry has witnessed 23 consecutive months of record year-over-year demand. This persistent demand is largely due to eggs being a key ingredient in numerous food products, from bread to processed foods.
This is partly due to the enduring popularity of eggs as an essential ingredient in food production, with businesses relying on eggs for products like bread, cakes, and processed foods.
Consumer buying habits have also played a significant role in driving up demand. Many households, concerned by reports of potential egg shortages, have begun stockpiling eggs, exacerbating the scarcity.
Brian Moscogiuri, an egg broker, pointed out that the fear of eggs running out has led consumers to purchase far more than they would under normal circumstances. This shift in buying behaviour further fuels the supply-demand imbalance, keeping prices high.
Market Volatility and Retail Strategies
While most wholesale eggs are traded under long-term contracts, the short-term spot market plays a key role in determining day-to-day prices. According to Moscogiuri, it is this 10% of eggs sold on the spot market that sets the true value of eggs, with fluctuating prices directly affecting consumer costs. Retailers, too, add another layer of complexity.
Some use eggs as “loss leaders,” offering them at reduced prices to attract customers who will then purchase other, higher-margin products. However, the pricing strategies of retailers can vary significantly, with some stores charging as much as $13 for a dozen, while others, like Aldi, keep prices lower at around $5.79.
