"Cracking the Shell: The Hidden Truth Behind Soaring Egg Prices and Farmer Struggles"
Tuesday, Mar 11, 2025 9:25 am ET
3min read The price of eggs has skyrocketed in recent years, leaving consumers and farmers alike grappling with the consequences. But the narrative that higher prices mean farmers are getting rich is far from the truth. The reality is much more complex and troubling. The surge in egg prices is primarily driven by two major factors: Highly Pathogenic Avian Influenza (HPAI) and inflation. Let's dive into the details and uncover the hidden truth behind this economic phenomenon.
The Devastating Impact of HPAI
HPAI has wreaked havoc on the poultry industry, leading to the loss of millions of birds. The USDA Animal and Plant Health Inspection Service (APHIS) has an indemnity program that provides compensation to farmers for infected or exposed poultry and eggs that are destroyed to control the disease. However, this compensation does not cover the costs during the period when the farm goes without income. It can take up to a year for a farm to complete cleaning and raise new chicks to egg-laying age, leaving farmers in a precarious financial situation.
The primary control and eradication strategy for hpai in domestic poultry, as defined by the World Organization for Animal Health (OIE), is de-population. When HPAI is detected, the entire flock is de-populated to prevent the spread of the virus. This strategy, while effective, is emotionally and economically devastating for farm families. The mortality rate of HPAI is near 100%, making it more lethal than the Ebola virus in humans. The de-population strategy, while necessary, leaves farmers with significant economic losses and emotional trauma.
The Role of Inflation
Inflation is another factor driving up egg prices. According to the Bureau of Labor and Statistics (BLS), the unadjusted Consumer Price Index (CPI) for all items for urban consumers rose 0.5% in January 2025, bringing CPI inflation for the year to 3%. The unadjusted 12-month CPI for eggs contributed to this, rising 53% from January 2024 to January 2025. Shorter term, the CPI for eggs was up 13.8% in just two months, from December 2024 to January 2025.
Inflation not only drives up the price of eggs in the grocery store but also raises the cost of everything it takes to produce eggs on the farm and get them on grocery store shelves. According to USDA’s latest farm income forecast estimates, total farm production expenses fell by 0.6%. Despite this drop, production costs for expenses like labor wages, interest, and fuel are still historically high following price spikes in 2022 and 2023. USDA NASS’s Prices Paid by Farm Type Index for Livestock Farms increased by 36% from January 2020 to January 2025. Even with higher prices for eggs, input costs and the added risk from HPAI make being an egg farmer a risky business.
The Economic Burden on Farmers
Another elevated supply cost for egg farmers is the price of chicks. Chicks that go on to become egg-laying hens cost more to replace than chicks that are used for meat production, which are called broilers. However, flocks used to provide eggs for laying hens are susceptible to avian influenza just like any other birds. Both sides of poultry production—egg layers and broilers—are suffering from increased replacement costs due to HPAI.
The two biggest factors driving egg prices to record levels are HPAI and inflation. HPAI is continuing to cause problems for poultry and egg farmers across the country with over 166 million birds affected since the outbreak began. Even though egg prices are at record levels, farmers are not getting rich. Expenses remain historically high, and farmers are continuing to fight through the risk of losing their flock to this devastating disease.
The Path Forward
The USDA has announced a $1 billion-dollar comprehensive strategy to curb HPAI, protect the U.S. poultry industry, and lower egg prices. This includes an additional $500 million for biosecurity measures, $400 million in financial relief for affected farmers, and $100 million for vaccine research. Farmers can take advantage of these funds to implement gold-standard biosecurity measures, which have proven to minimize flu cases. For example, the approximately 150 facilities that follow these protocols have had only one outbreak.
Alternative control methods, such as vaccination, could potentially mitigate some of these long-term implications. The USDA has allocated up to $100 million for vaccine research and development, with the goal of reducing the need for depopulation. Vaccination could provide a more sustainable solution by protecting flocks from the virus, thereby maintaining egg production and reducing economic losses. However, there are challenges to implementing a vaccination strategy. Some countries bar poultry imports from nations that vaccinate commercial poultry due to concerns that vaccination could mask ongoing avian flu circulation. The World Organization for Animal Health (WOAH) has acknowledged the need to review existing control strategies, given the rapid spread of the virus and the potential limitations of current tools. The USDA is working closely with stakeholders to assess the potential negative trade effects and public health concerns associated with vaccination.
In summary, the interplay between inflation and the cost of production poses significant challenges to the profitability of egg farmers. However, by investing in biosecurity measures, exploring temporary import options, and developing innovative strategies to limit depopulations, farmers can mitigate these economic pressures while maintaining the quality and supply of eggs. The path forward is fraught with challenges, but with the right support and strategies, the poultry industry can weather this storm and emerge stronger.
The Devastating Impact of HPAI
HPAI has wreaked havoc on the poultry industry, leading to the loss of millions of birds. The USDA Animal and Plant Health Inspection Service (APHIS) has an indemnity program that provides compensation to farmers for infected or exposed poultry and eggs that are destroyed to control the disease. However, this compensation does not cover the costs during the period when the farm goes without income. It can take up to a year for a farm to complete cleaning and raise new chicks to egg-laying age, leaving farmers in a precarious financial situation.
The primary control and eradication strategy for hpai in domestic poultry, as defined by the World Organization for Animal Health (OIE), is de-population. When HPAI is detected, the entire flock is de-populated to prevent the spread of the virus. This strategy, while effective, is emotionally and economically devastating for farm families. The mortality rate of HPAI is near 100%, making it more lethal than the Ebola virus in humans. The de-population strategy, while necessary, leaves farmers with significant economic losses and emotional trauma.
The Role of Inflation
Inflation is another factor driving up egg prices. According to the Bureau of Labor and Statistics (BLS), the unadjusted Consumer Price Index (CPI) for all items for urban consumers rose 0.5% in January 2025, bringing CPI inflation for the year to 3%. The unadjusted 12-month CPI for eggs contributed to this, rising 53% from January 2024 to January 2025. Shorter term, the CPI for eggs was up 13.8% in just two months, from December 2024 to January 2025.
Inflation not only drives up the price of eggs in the grocery store but also raises the cost of everything it takes to produce eggs on the farm and get them on grocery store shelves. According to USDA’s latest farm income forecast estimates, total farm production expenses fell by 0.6%. Despite this drop, production costs for expenses like labor wages, interest, and fuel are still historically high following price spikes in 2022 and 2023. USDA NASS’s Prices Paid by Farm Type Index for Livestock Farms increased by 36% from January 2020 to January 2025. Even with higher prices for eggs, input costs and the added risk from HPAI make being an egg farmer a risky business.
The Economic Burden on Farmers
Another elevated supply cost for egg farmers is the price of chicks. Chicks that go on to become egg-laying hens cost more to replace than chicks that are used for meat production, which are called broilers. However, flocks used to provide eggs for laying hens are susceptible to avian influenza just like any other birds. Both sides of poultry production—egg layers and broilers—are suffering from increased replacement costs due to HPAI.
The two biggest factors driving egg prices to record levels are HPAI and inflation. HPAI is continuing to cause problems for poultry and egg farmers across the country with over 166 million birds affected since the outbreak began. Even though egg prices are at record levels, farmers are not getting rich. Expenses remain historically high, and farmers are continuing to fight through the risk of losing their flock to this devastating disease.
The Path Forward
The USDA has announced a $1 billion-dollar comprehensive strategy to curb HPAI, protect the U.S. poultry industry, and lower egg prices. This includes an additional $500 million for biosecurity measures, $400 million in financial relief for affected farmers, and $100 million for vaccine research. Farmers can take advantage of these funds to implement gold-standard biosecurity measures, which have proven to minimize flu cases. For example, the approximately 150 facilities that follow these protocols have had only one outbreak.
Alternative control methods, such as vaccination, could potentially mitigate some of these long-term implications. The USDA has allocated up to $100 million for vaccine research and development, with the goal of reducing the need for depopulation. Vaccination could provide a more sustainable solution by protecting flocks from the virus, thereby maintaining egg production and reducing economic losses. However, there are challenges to implementing a vaccination strategy. Some countries bar poultry imports from nations that vaccinate commercial poultry due to concerns that vaccination could mask ongoing avian flu circulation. The World Organization for Animal Health (WOAH) has acknowledged the need to review existing control strategies, given the rapid spread of the virus and the potential limitations of current tools. The USDA is working closely with stakeholders to assess the potential negative trade effects and public health concerns associated with vaccination.
In summary, the interplay between inflation and the cost of production poses significant challenges to the profitability of egg farmers. However, by investing in biosecurity measures, exploring temporary import options, and developing innovative strategies to limit depopulations, farmers can mitigate these economic pressures while maintaining the quality and supply of eggs. The path forward is fraught with challenges, but with the right support and strategies, the poultry industry can weather this storm and emerge stronger.
