The U.S. egg market has seen large increases in shell egg market prices since the beginning of June through the July 4th holiday.
May is traditionally one of the worst periods for shell egg demand due to retailers shifting their attention toward grilling items as they prepare for summer months, explained Brian Moscogiuri, Eggs Unlimited Global Trade Strategist. However, shell egg demand seems to be higher this year due to multiple factors.
“Moving into June, farmers start seasonal rotations and adjusting their outputs to a lower demand level after the Easter holiday,” he said.
The seasonal trend combined with the recent high heat in a sizable portion of production areas across the Midwest and the production belt have reduced the industry’s production levels.
“Hotter temperatures will reduce egg output due to potential heat-induced stress on the birds, which has attributed to June’s surge in pricing,” Moscogiuri continued.
Promotion not needed
Features at the retail level are limited right now as retailers see no benefit in promoting a continuously elevated level of demand with a small supply.
With everything going on with the economy, we believe egg demand will continue to stay consistent, as long as eggs are not an astronomical price, because the higher prices of other protein options are less attractive compared to shell egg pricing, explained Moscogiuri.
According to the U.S. Department of Agriculture’s (USDA) July 2022 Egg Market Overview, the Midwest wholesale price for Large, white, shell eggs reached $2.52 per dozen while California increased to $3.35 per dozen.
“Eggs are benefiting from other protein prices and inflation. Consumers are low on money to spend right now due to travel, spending money on gas, dealing with interest rates and increased costs on other items,” stated Moscogiuri.
Avian influenza
The U.S. egg industry is still missing approximately 30 million layers due to avian influenza, even though birds are starting to be repopulated. As a result, the market is seeing a greater number of mediums due to the tendency of younger birds to produce lighter eggs and will continue to see more.
“The last few inventory levels were some of the lowest we have seen on shell eggs since the pandemic’s shopping surge,” he stated. We expect to see supply level improve with repopulation as we move through the end of the summer and into the fall, explained Moscogiuri.
