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Rising egg prices have thrust the household staple back into the spotlight as consumers worry not just about inflation but also the absolute level of prices.
July marked the third consecutive month that egg prices rose year-on-year, reversing last year’s relative decline. The main culprit is the ongoing battle against highly pathogenic avian influenza, known as HPAI or avian influenza.
Prices for the key food ingredient soared 19.1% in July compared with the same period last year, according to Consumer Price Index (CPI) data released this week. By comparison, the entire CPI basket rose only 2.9% during the same period.
Given the ubiquity of eggs in daily cooking, rising egg prices have become a focus for consumers during the pandemic. The rise in eggs and other groceries has been top of mind for consumers dealing with rising costs, which in turn has hurt consumer confidence in recent years.
But the latest surge in inflation appears to be linked to a nearly 8% spike in March to April, which may be linked to seasonal patterns in bird flu. This is the largest monthly increase since spring 2023.
“We think the short answer has to do with avian flu,” said Caitlinn Hubbell, a market research analyst at Purdue University’s Center for Food Demand Analysis and Sustainability in West Lafayette, Indiana. “Although It’s so unfortunate that high-pathway avian influenza still exists.”
Avian influenza experienced a historic outbreak in 2022 and surged again at the end of 2023.
Egg demand is considered “inelastic,” Hubbell said, meaning consumers will typically buy the same amount of eggs regardless of price increases. On the other hand, she noted that consumers generally don’t stock up when they see lower costs.
Inelastic goods tend to see large price changes due to small changes in supply, she said. This could highlight the impact of bird flu outbreaks on the prices customers see on grocery store shelves.
For shoppers, this results in higher prices. The average price of a dozen large Grade A eggs exceeded $3 in July for the first time in more than a year, according to the agency. Bureau of Labor Statistics.
Although price growth has reaccelerated, prices are still more than 20% below last year’s levels. Nonetheless, the price of eggs in the CPI basket is up about 42% compared to July 2021.
Hubbell said that going forward, price trends will depend on the status of bird flu. But she hopes consumers will see some relief as outbreaks are less likely during the upcoming season.
“It’s hard to say,” Hubbell said. “It all depends on the scale and scope of the impact of highly pathogenic avian influenza.”
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