The prices for wholesale eggs are falling. How quickly does it affect grocery bills? : NPR

After months of sticker shock from the national egg crisis, relief may finally be approaching.

The USDA reported Friday that the national average wholesale price of eggs has been steadily declining since late February. In other words, the costs that distributors are charging retailers are declining.

According to the latest USDA report, the average wholesale cost for large white eggs was $4.15 per dozen. About half of it just a few weeks ago.

The decline in wholesale prices was due to the lack of major bird flu outbreaks in March so far, allowing the country’s egg supply to begin to recover. The economist told NPR, but how quickly prices change at grocery stores depends on a number of key factors.

Here’s what you need to know.

Retail egg prices can drop quickly if bird flu is occupied

Wholesale egg prices have fallen for three consecutive weeks, according to the USDA. But that may not be reflected in your local grocery store. That’s not uncommon, according to Joseph Baragtus, a professor of agricultural economics at Purdue University.

“The eggs we see today were purchased by retailers at a wholesale price we won a few weeks ago,” he said in an email. Stock issues could also play a role, but he expects stores prices could be easier within a few days.

Jadrian Wooten, a professor of economics at Virginia Tech, said part of the reason for the rug is that grocery chains are wary of cutting prices faster. There is still continuing concern about the future outbreak of avian flu, which could disrupt supply again.

“They’re always going to lower the price of eggs a little later than the wholesale side of things,” he said. Wooten believes that the biggest factor is whether the virus is present.

“As long as we are, we should see those prices drop in the coming weeks,” he said. “Unfortunately, if the avian flu comes out again, if there’s another big outbreak on another big farm, I think you’ll see the exact opposite.”

Lower demand can help reduce costs. So don’t panic your eggs, experts say

By surge in egg costs, it’s no surprise that many Americans are looking for a source of protein, many Americans are looking elsewhere. Ironically, that change in attitude can help prevent egg prices from rising even further.

“It’s because it’s actually a market signal for US consumers to buy fewer eggs,” David Anderson, a livestock economist and professor at Texas A&M University, told an email.

That’s why Wooten at Virginia Tech advises customers on buying eggs in bulk when they’re worried about prices going up. “What drives egg prices is the panic purchases people have been making over the past few months,” he said.

How about Easter and Passover? Economists have told NPR that these holidays usually cause demand conflicts. But they don’t think it will become a major barrier to reducing retail costs.

What about price gouging concerns?

In January, a group of democratic lawmakers said food companies “often as an opportunity to “exploit outbreaks like the pandemic and avian flu and raise prices beyond what they need to cover the rising costs.” And earlier this month, several media outlets reported that the Department of Justice had launched an investigation into whether major egg producers played a deliberate role in price surges. (NPR does not independently confirm the investigation.)

However, economist NPR said he remains skeptical that Price Gouging is playing. Purdue’s Balagtas said wholesale prices are consistently in line with avian flu cases and trends in egg production. He said there was evidence suggesting that retailers had exercised restraints in raising prices.

“From May 2024 until last month, wholesale egg prices rose 350%. Over that same period, retail prices rose 120%,” he said. Balagtas added that it suggests that “retailers are trying not to hand over the full cost of rising wholesale prices to consumers.”

Anderson of Texas A&M University similarly said he doesn’t believe price-raising concerns apply to the egg crisis because the fight against avian flu is so expensive for producers.

“We know that bird flu has dramatically reduced supply, leading to higher prices,” he said. “If you get the bird flu, you don’t have eggs to sell and you don’t benefit from the price increase.”

Will the egg carton be another $2?

It’s a head turn to remember that in a short time in 2023, dozen eggs were approaching $2. Last month, NPR reported that dozen eggs could cost between $4 and $8 or more at grocery stores. According to the U.S. Bureau of Labor Statistics’ Consumer Price Index, the average price for many large eggs in February was $5.90.

Wooten said he hopes Americans can see the egg price return to $2-3. “I don’t think it’ll take years to get us back to it,” he said.

When a farm loses a flock of spawning hens to the avian flu, it takes between six months and a year for the farm to recover.

“Hopefully by summer, like a farm that has lost its bundle, they will have brand new chickens that are basically breeding full steam,” Wooten said. “But again, I go back to the assumption that avian flu doesn’t back up.”