Market News
Why record-high egg prices won’t go down anytime soon —
and it’s not just due to bird flu
The CPI inflation report shows that egg prices rose another 10% in February. Here’s what goes into the cost of eggs, and what’s keeping them so expensive.
Published: March 12, 2025 at 3:43 p.m. ET
A lot goes into the production of eggs — and with the Trump administration’s tariff policies potentially affecting costs for chicken feed and equipment, bird flu isn’t the only reason U.S. consumers may continue to pay high prices for eggs at the grocery store.
The average price of a dozen large eggs rose to an all-time high of $5.90 in February, up from around $2.50 a year earlier, according to U.S. consumer-price index data released Wednesday. The price rose just over 10% in February, following an increase of 15% in January.
“Retail egg prices are determined by multiple factors, including supply and demand, production costs, regulatory changes and potential market manipulation,” Sharmah Seakar, senior procurement lead at Efficio, a global procurement and supply-chain consultancy, told MarketWatch.
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The high prices for the grocery staple have led the U.S. Justice Department to open an investigation into the cause and whether large producers have conspired to raise prices or hold back supply, according to a Wall Street Journal report earlier this month citing people familiar with the matter. When reached by MarketWatch, a spokesperson at the department declined to comment.
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In a statement dated March 10, Emily Metz, president and chief executive officer of the American Egg Board, which represents U.S. egg producers, said that “to suggest that higher egg prices are the result of anything other than bird flu is a misreading of the facts and the reality.”
She continued: “Make no mistake. Egg farmers are price takers, not price makers, on the egg market, and that market is responding to the uncertainty and chaos bird flu is causing.”
Bird flu
There’s no question that bird flu, or highly pathogenic avian influenza, is the key reason for the spikes in retail egg prices and the drop in supplies. As of March 11, the U.S. Centers for Disease Control and Prevention reported that a total of 166.2 million birds in all 50 states have been affected since January 2022.
In 2024, avian influenza outbreaks and facility fires resulted in the loss of 39.9 million commercial table-egg layers in 12 states, according to a Jan. 3 report from the U.S. Department of Agriculture.
And with more than 163 million chickens, turkeys, and other bids having died from bird flu or been culled due to proximity to sick birds since 2022, fewer hens are laying eggs, said Arlan Suderman, chief commodities economist at StoneX.
Data show that 19.5 million egg-laying chickens were killed in January 2025, the highest monthly total since March 2022, Suderman said, adding that about 18.8 million of those were chickens specifically providing eggs to the food line. There were 379 million laying hens in the United States in January 2024.
‘The good news is that chickens can be repopulated within a few months. The bad news is that the U.S. continues to kill chickens due to bird flu.’
— Arlan Suderman, StoneX
“The good news is that chickens can be repopulated within a few months,” Suderman said. “The bad news is that the U.S. continues to kill chickens due to bird flu.”
Related: Egg prices represent the cracks in the facade of America’s economic wellbeing
Egg production
The production process for eggs includes several “cost-intensive stages,” said Efficio’s Seakar.
The first stage is breeding and rearing chicks into egg-laying hens, which requires feeding, healthcare and housing, he said. Layer-hen maintenance is the next stage, with mature hens requiring regular feeding, health monitoring and controlled environments.
Then comes egg collection and processing, with automatic systems for sorting, cleaning and packaging the eggs, said Seakar, who added that infrastructure investments drive up costs.
Egg producers must also comply with regulations and meet cage-free mandates, which “require new housing systems and millions in investment per farm,” he said.
Producers typically earn 50 cents to $1 per dozen eggs after production costs, while retailers apply a 20% to 40% markup, currently putting store prices at $4 to $5 per dozen.
— Sharmah Seakar, Efficio
Rising feed and regulatory costs have lifted the cost of production to $2.50 to $3 per dozen, Seakar said. Producers typically earn 50 cents to $1 per dozen eggs after production costs, while retailers apply a 20% to 40% markup, putting store prices at $4 to $5 per dozen, he said.
In California, one of the states where consumers are paying the most for eggs, the benchmark price for a dozen large eggs was $10.35, according to a March 7 report from the Department of Agriculture.
State regulations like California’s Proposition 12 on the confinement of farm animals stipulate minimum space requirements for egg-laying hens. That could be affecting egg prices at a regional level, said Curt Covington, senior director of managed accounts at AgAmerica, a nonbank agricultural lender.
He also pointed out that a rough Atlantic hurricane season last year led to damage and losses at many poultry and egg facilities in the Southeast, as well as higher costs for labor and transportation, which have increased overall production expenses.
And while the Trump administration’s shifting tariff policies may not have a direct impact on egg prices, “a second consequence might arise if we start seeing feed or equipment costs go up in response,” Covington said.
There are “lots of moving parts worth keeping a close eye on,” he said. “At AgAmerica, we’re advising clients to focus on operational efficiency, cost management, market diversification and strategic financial planning to navigate current volatility.”
The ‘new norm’
For now, U.S. consumers are likely to see egg prices remain high “due to avian flu risks, feed cost inflation and ongoing regulatory changes,” Seakar said.
Over the longer term, for 2026 and 2027, there’s the potential for prices to stabilize, he said.
If avian flu outbreaks decline, hen populations will recover, increasing supply, Seakar said. Cage-free infrastructure adjustments could also stabilize costs over time.
‘Given new industry realities, a stable price of $3 [to] $3.50 per dozen may be the new norm.’
— Sharmah Seakar, Efficio
“Investigation outcomes into market manipulation could lead to pricing correction,” he said.
Even then, however, egg prices will remain elevated compared with the historical norm, Seakar said. “Given new industry realities, a stable price of $3 [to] $3.50 per dozen may be the new norm.”
