The Egg Shortage Crisis: A Perfect Storm of Avian Flu, Price Spikes, and Market Consolidation
The Rise of the Egg Emergency: Desperation and Skyrocketing Prices
The egg industry is in chaos. Calls and messages flood in before dawn from desperate restaurants, bakeries, and retailers scrambling to secure eggs. Brian Moscogiuri, a vice president at Eggs Unlimited, spends long hours in his home office in Toms River, N.J., trying to connect buyers with farms that still have eggs to sell. But the job has become more about managing expectations and offering emotional support than making deals. The reason? Avian influenza has decimated egg supplies, driving wholesale prices to record highs—now averaging over $8 per dozen, up from $2.25 in the fall of 2022.
For buyers, the situation is dire. Eggs, once a staple, have become a luxury, with prices triple or quadruple what they used to be. Small family-owned farms are equally anxious; a single case of H5N1 virus could wipe out their entire flock, destroying their livelihood overnight. Yet amidst this crisis, one player has emerged as a clear beneficiary: Cal-Maine Foods, the largest egg producer in the U.S. The company has seen its revenues surge by 82% year-over-year, reaching $954 million in the most recent quarter, and its net income skyrocket by more than 500% to $218 million.
Cal-Maine Foods: Profiting from Scarcity and Market Power
Cal-Maine Foods, which controls about 20% of the U.S. egg market and supplies major retailers like Walmart, has thrived during the shortage. Its success is not just luck; it’s the result of decades of industry consolidation. Since 1989, Cal-Maine has acquired over two dozen companies, and today, it and four other large producers control roughly half the egg market. While Cal-Maine’s scale has allowed it to weather the avian flu outbreak better than smaller farms, its dominance has also raised questions about its market power and pricing practices.
The company’s profits have been boosted by higher prices, lower feed costs, and strategic acquisitions. Yet, this success comes at a time when consumers are struggling. Egg prices have soared, with some areas seeing a dozen eggs cost over $10. The concentration of egg production in the hands of a few giant companies has sparked concerns about anticompetitive behavior, particularly given the history of price-fixing in the industry.
The Political Fallout: Calls for Investigations and Accountability
The egg crisis has turned into a political hot potato. As egg prices remain stubbornly high, lawmakers have begun to demand action. A group of Democratic senators, led by Elizabeth Warren, has called on federal regulators to investigate the industry, accusing producers of potentially exploiting the avian flu outbreak to artificially constrain supply and inflate prices. In a letter to the Federal Trade Commission (FTC), Farm Action, an advocacy group focused on corporate monopolies in agriculture, urged the agency to probe potential monopolization and anticompetitive practices in the egg industry.
The FTC has faced pressure before. In 2023, a jury found major egg producers liable for inflating prices in the 2000s, ordering them to pay $53 million in damages. Now, critics argue that similar dynamics may be at play. Basel Musharbash, an antitrust attorney, warns, “There’s smoke there that suggests there may be a fire underneath. The incentives are there, the power is there to restrain supply.” The FTC’s resources were tied up in recent antitrust efforts, including a high-profile case against the merger of grocery giants Kroger and Albertsons, but now that the merger has been blocked, attention may turn back to the egg industry.
The Historical Context: A Pattern of Anticompetitive Behavior
This is not the first time the egg industry has faced allegations of price-fixing. In 2011, major food companies like Kraft and General Mills sued egg producers and trade groups, accusing them of colluding to reduce supply and drive up prices. Internal documents revealed a coordinated effort to shrink flocks and boost profits. For example, the United Egg Producers, a trade group, urged its members to cut their flocks by 5% to achieve “profitable egg prices.” These practices continued for years, prompting lawsuits and eventually a jury verdict in 2023 that held producers liable for unlawful price inflation.
While Cal-Maine and other producers have appealed the verdict, the case has cast a shadow over the industry. Separate accusations of price-gouging during the COVID-19 pandemic further eroded public trust. In 2020, New York’s attorney general accused Hillandale Farms of inflating prices during the pandemic, leading to a settlement that included donating eggs to food banks. A similar suit against Cal-Maine in Texas remains unresolved. These incidents have left many wondering whether the industry’s current pricing practices are a repeat of past abuses.
The Broader Implications: Eggs, Antitrust, and the Food System
The egg crisis highlights deeper issues in the U.S. food system. Decades of consolidation have left a handful of companies dominating key markets, from eggs to meat and grains. While large producers like Cal-Maine argue that their size allows them to respond to crises more effectively, critics warn that this concentration of power can lead to exploitation. “If 15% of eggs are out of the system, prices should go up 15%, but we’re seeing 255% increases,” said Jada Thompson, an agricultural economist. “This is about demand, yes, but it’s also about businesses’ ability to pass costs onto consumers.”
As the FTC and Justice Department weigh whether to launch a new investigation, the egg industry’s fate—and the future of food production—hangs in the balance. The American Egg Board insists that the price spikes are driven by factors like bird flu and increased demand, which are beyond farmers’ control. Yet, for many, the temptation to exploit a crisis may be too great to resist. Whether regulators step in to restore competition or let the status quo prevail will shape not just the price of eggs but the entire food system.
In the end, the egg shortage serves as a stark reminder of how fragile and interconnected our food supply is. As consumers grapple with empty shelves and soaring prices, one thing is clear: the eggs in our cartons are just the tip of the iceberg in a much larger battle over fairness, competition, and power in the food industry.
This summary provides a comprehensive overview of the egg shortage crisis, its causes, and its implications. It raises critical questions about market power, antitrust regulations, and the balance between corporate profits and consumer welfare. For further exploration, consider the following questions:
- How does the concentration of market power in the egg industry affect prices and competition?
- What role should regulators play in addressing price spikes and potential anticompetitive behavior?
- How can smaller, family-owned farms be supported in the face of industry consolidation and crises like avian flu?
- What steps can consumers and policymakers take to ensure fair pricing and access to essential food items?
- How do historical antitrust violations in the egg industry inform the need for oversight today?
