High egg prices should be investigated, says U.S. farm group By Reuters
© Reuters. FILE PHOTO: A display case of eggs is seen nearly empty at a Giant Food grocery store as the United States continues to experience supply chain disruptions in Washington, U.S., January 9, 2022. REUTERS/Sarah Silbiger / File Photo
By Lea Douglas
(Reuters) – The Federal Trade Commission (FTC) should review high egg prices for signs of rising prices from major egg companies, a farming group said, as Americans continue to pay more than ever for household staple food.
U.S. regulators, farmers and industry have often argued in recent years over the power of big agribusiness to set prices and raise what consumers pay for groceries, like when the price of beef soared. skyrocketing in 2021.
The latest concern is eggs, the price of which rose 138% in December from a year earlier to $4.25 per dozen, according to the Bureau of Labor Statistics.
The United States Department of Agriculture (USDA) pointed to a record outbreak of bird flu as the reason for the high prices. But the country’s antitrust regulator is also expected to review the record profits of the largest egg company, Farm Action said Thursday in a letter to FTC Chair Lina Khan.
Cal Maine Foods (NASDAQ:), which controls 20% of the retail egg market, saw quarterly sales up 110% and gross profits up more than 600% from the same quarter last year, according to a file filed at the end of December with the Securities and Exchange Commission.
The company pointed to dwindling egg supply nationwide due to rising bird flu prices as the reason for its record sales. The company has had no positive bird flu tests on any of its farms.
U.S. egg production was about 5% lower in October than a year ago, and egg stocks were down 29% in December from the start of the year, according to the latest USDA data – a significant drop, but which may not explain the record – high prices, said Basel Musharbash, an attorney for Farm Action.
“We want the FTC to dig in and see if consumer prices are being abused,” Musharbash said.
The FTC declined to comment.
In a statement, Cal-Maine said higher production costs, as well as bird flu, were contributing to higher prices.
The American Egg Board, an egg marketing group, said in a statement that egg prices reflect a variety of factors and wholesale egg prices are beginning to decline.
Nearly 58 million chickens and turkeys have been killed by bird flu or to control the spread of the virus since the start of 2022, mostly in March and April, according to the USDA. The previous largest outbreak, in 2015, killed 50.5 million birds.
Cal-Maine shares have fallen in recent weeks after soaring nearly 50% last year.