Chickens are a remarkably adaptable species, thriving in diverse climates and easily fitting into both small-scale and industrial farming systems. Their ability to consume a wide range of feed, reproduce quickly, and lay eggs consistently has made them an efficient, readily renewable source of protein for mankind. Thus chickens have become a key pillar of agriculture across most continents and levels of economic development. Over the last century, chicken eggs have become not just a global dietary staple but also a critical ingredient in processed foods, baked goods, and sauces. Their versatility in cooking and nutrient density have cemented their role as a cornerstone of global food systems.
In the United States, eggs are a cultural and economic mainstay. The average American consumed 281.3 eggs in 2023, highlighting their ubiquity in our diets. The US is one of the top egg producers globally, generating approximately 110 billion eggs annually. Economically, the industry contributes over $10 billion to the national economy each year and provides direct employment to more than 500,000 workers. Beyond their economic impact, eggs are valued for their affordability and nutrition, offering 6 grams of high-quality protein alongside essential nutrients like vitamin D, B12, and choline. This combination of dietary value, economic significance, and accessibility underscores the central role of eggs in the American food landscape.
Egg prices have surged in recent weeks, driven by a convergence of supply disruptions and cost pressures. The ongoing avian influenza outbreak has led to the culling of hundreds of millions of hens, drastically reducing supply and driving prices higher. Rising feed costs, higher energy prices, and elevated transportation expenses—fueled by broader inflationary trends—have further compounded production costs. The US Consumer Price Index for eggs has reached record levels, and the price of a dozen Grade-A eggs now averages $4.15, only slightly below the all-time high of $4.25 seen in late 2022. Prices are, in many areas, vastly higher than that, creating ripple effects across food production systems and household budgets.
USD Price of One Dozen Grade A Large Eggs (1980 – present)
(Source: Bloomberg Finance, LP)
Globally, egg prices serve as a uniquely informative barometer of inflationary dynamics, reflecting rapid changes in input costs and supply chain conditions. Their short and straightforward supply chain allows prices to respond quickly to fluctuations in the costs of inputs. Feed prices, in particular, represent a significant share of production costs and are tied to volatile global commodities markets, which can lead to swift price adjustments. The short production cycle of eggs amplifies their responsiveness to economic shocks, as disruptions such as feed price hikes or disease outbreaks quickly translate into market prices.
Typically, as the prices of goods increase, consumers shift to substitutes, but eggs have few viable alternatives. As a result, demand for eggs has proven quite inelastic: steady, despite persistently rising prices. The tightening supply of eggs has also forced grocery stores to rethink pricing strategies. Traditionally, retailers often kept egg prices low—even absorbing cost increases—to attract shoppers who would then purchase additional items. The dual pressures of inflation and avian flu-induced supply constraints have rendered loss leader tactics unsustainable. Consequently the degree of inelasticity of demand for eggs is being tested.
The frustration many Americans feel about surging egg prices reflects a growing sense of cognitive dissonance in the current economic narrative. While policymakers and headlines tout disinflation, the impact of four years of above-average inflation amid production problems culminating in escalating grocery costs—eggs near the top of that lengthening list—creates a stark disconnect. Within the last few weeks, a shopper at H-E-B took to social media to voice frustration after discovering an 18-pack of pasture-raised large brown eggs priced at nearly $12. California restaurant owners are struggling with egg prices nearing $9 per dozen; a sharp increase from the previous year which is forcing some to cut staff and tighten budgets to remain operational.
US CPI Urban Consumers Eggs (NSA, 1935 – present)
(Source: Bloomberg Finance, LP)
Also, remarkably devoid of any self-awareness, the same class-warfare politicians who spent the last four years insisting that no level of spending or accommodation were too much have now, several days after a new president’s inauguration, discovered a sudden and urgent concern for rising prices. Despite them, and as inconceivable though it was fifty years ago, egg prices are slowly and steadily exceeding the reach of a growing number of American consumers.
Discretionary central banking policies, such as the Federal Reserve’s 2 percent annual inflation target, further complicate the picture. Systematically rising prices compel businesses to adopt aggressive cost-cutting measures to remain competitive. Farming, and the poultry industry in particular, was already characterized by industrial farming to capture economies of scale amid thin profit margins. While that approach enhances efficiency and feeds hundreds of millions of people, it comes with setbacks including growing antibiotic resistance and the emergence of increasingly virulent pathogens. Those practices periodically necessitate large-scale cullings, causing dramatic price spikes.
Avian flu outbreaks have significantly disrupted egg production and created price spikes in the past. The 2014–2015 H5N2 outbreak in the US led to the culling of nearly 50 million birds, doubling egg prices in some cases. The 2005–2006 H5N1 outbreak, originating in Asia, spread globally, impacting poultry markets and egg prices in import-dependent regions. There have been others, but none have seen price jumps of the order of magnitude seen recently, and certainly not for extended periods. Modern food production systems come with intrinsic setbacks, but unstable prices exacerbate them.
Skyrocketing egg prices reflect the vulnerabilities and complexities of global food systems amid discretionary central banking. Intensive poultry farming coupled with inflationary pressures creates a volatile environment where price stability is increasingly difficult to achieve. Those dynamics are not isolated to eggs, of course, but are indicative of broader challenges in balancing economic efficiency and resilience in essential industries with interventionist monetary policy in the background. Economic calculation is deeply challenging even in periods of stable prices. The lumber delirium of 2020, the global supply chain collapse of 2021, and scores ofotherconsequences in addition to today’s soaring egg prices, are sending a clear message: where the execution of monetary policy is activist in nature, society must brace for disruptions to goods and services once taken for granted, with both greater frequency and intensity. It is a choice to which, whether by disinterest or inaction, Americans have committed.
