Oversupply lowers egg prices now, but avian flu risks may tighten supply soon
Egg prices have recently dropped to levels not seen since 2023, giving consumers temporary relief at grocery stores. According to agricultural economists, the decline is mainly linked to an oversupply of eggs in the market.
Producers increased production during the winter months because they expected heavy losses from highly pathogenic avian influenza, commonly known as HPAI.
“Growers, anticipating negative effects from avian influenza during the winter, increased the number of eggs they produced,” said Jada Thompson, associate professor and economist for the University of Arkansas System Division of Agriculture. “That left growers with plenty of eggs, and consumers are the ones who get to benefit.”
However, the expected large-scale impact on commercial egg-laying flocks did not occur. As a result, more eggs reached the market than expected, creating strong supply levels and lowering wholesale prices. While consumers benefit from cheaper eggs, the situation is more difficult for farmers, who often operate with narrow profit margins. Lower prices reduce earnings and increase financial pressure on producers.
Industry experts explain that egg production is closely tied to biological timelines, meaning supply changes cannot happen instantly. Even when producers decide to slow production, it takes time for the supply chain to adjust. Because of this, the egg market may remain well supplied for the next several months unless major disruptions occur.
At the same time, the risk of HPAI remains a concern. The disease cycle began in early 2022 and has affected millions of birds across the United States, including both commercial and backyard flocks. Although the number of commercial flocks affected has declined in recent months, new outbreaks could still emerge and quickly tighten supplies.
Economists suggest that producers may soon reduce egg sets to avoid prolonged low prices. If this happens, the supply pipeline could shrink, which may lead to higher prices later in the year. The egg market continues to change rapidly, influenced by disease risks, production decisions, and consumer demand.
Overall, the current low prices may not last long. While consumers enjoy short-term savings, farmers must balance production decisions carefully as they navigate ongoing disease risks and changing market conditions.
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