Circana recently published the results of a consumer survey relating to acceptance of pork from genetically modified hogs.  The study comprised 5,000 subjects from eight industrialized nations with a questionably high response rate of 96 percent. In this case, consumers were requested to provide an opinion as to whether they would purchase pork from genetically modified hogs, thereby reducing potential antibiotic use. Overwhelmingly (94 percent) of consumers were willing to purchase pork from gene-edited hogs with a proviso that the process would offer tangible benefits to consumers and that appropriate transparency including packaging would be maintained. This said, interpretation of survey results are highly dependent on the framing of questions and selection of participants.

The study presumably relates to the biotechnology introduced by UK-based Genus plc.  This company pioneered deletion of the CD163 gene by applying CRISPR to produce piglets resistant to porcine reproductive and respiratory syndrome (PRRS).  Genus plc has applied to the U.S. Food and Drug Administration for approval of the gene-deleted strain of hogs since CRISPR is regarded inexplicably by FDA bureaucrats as an “investigational new drug”.  It is anticipated that the Agency will expedite approval since CRISPR involves deletion of genetic material not involving insertion of novel genes.  It is noted that acceptance of genetically modified salmon by the FDA required decades before the Aqua Bounty® strain of salmon was approved since the technology involved introduction of genes from other salmon and marine species.

The response of potential consumers to the hog study has relevance to possible gene modification of chickens to enhance growth and livability and in the short term for gender sorting of egg-production strains.  NRS Poultry Sustainability and Transformation Inc. in association with scientists at the Volcani Institute in Israel has developed a unique genetic approach to identifying and eliminating cockerel chicks.  Dr. Yuval Cinnamon affiliated to the Institute and founder of NextHen has promoted the ‘Golda’ approach to eliminating male embryos in-ovo. 

The technique involves application of CRISPR-CAS9 to a sequence of the z chromosome, a co-determinant of gender in chickens.  Males carry the zz chromosome and females are zw.  The construct developed by NRS with intended commercialization by NextHen requires insertion of promoters adjacent to the 5’HA end of the sequence and insertion of a lethal gene adjacent to the 3’HA end.  Lethality is activated by exposure to light of a highly specific blue wavelength.  The construct must be inserted into the pure line C strain to pass the altered z chromosome to the grandparent C-line hen.  The female of the parent level (CD) will therefore carry the modified z chromosome.  The male line AB parents are normal in all respects.  At the parent level CD females carrying the modified z chromosome mated to AB males produce pullet chicks with a normal z and w chromosomes.  Eggs from the mating are subjected to blue light that is optogenic in its action on the z chromosome carrying the lethal gene.  This results in inhibition of development of male (zz) embryos since they carry the lethal trait on the z chromosome acquired from the CD parent female (zw).  Female embryos carry an unaltered z chromosome and therefore hatch normally.

The NRS/NextHen approach to eliminating male chicks is elegant, based on establish scientific principles and offers advantages with respect to cost, practicality and rate of implementation.

Despite the obvious advantages, primary breeders have demonstrated no inclination to adopt the system and have instead applied currently available alternatives to identify eggs bearing male embryos. 

From a scientific perspective, commercial pullet chicks are not genetically modified, but the system relies on insertion of a construct into the pure C line.  There is obvious concern that opponents of intensive livestock production will cite the application of genetic modification to demonize not only the specific Golda hen but will extended deprecation to all commercial egg production.  Neither of the two leading primary breeders wishes to be first to adopt the technology given the “tainted GMO association.” For the NRS/Volcani/NextHen technology to become a reality, it will be necessary to confirm that consumers will accept the highly technical assurance that the commercial level chick is not genetically modified.  In the case of the Genus PRRS-resistant hog the technology involved deletion of a gene applying CRISPR. The survey revealed that approximately half of U.S. consumers evidently are aware of gene editing. 

It is possible that China may adopt the technology given their volume of production and with Governmental support of GMO, justifying application.  China is rapidly developing pure lines and has aspirations to be independent of major primary breeders located in the E.U. and the U.S. for domestic needs and export.

There is no obvious benefit to consumers from applying the genetic approach to eliminating cockerels given that non-GMO alternatives are commercially available and are currently in use.

For the NR technology to become a practical reality the first hurdle will be for one or more of the primary breeders to enter into a strategic alliance with the developers and incorporate the z chromosome construct into the pure C line.  The second challenge will be to convince consumers and regulators that the pullet chicks are effectively non-GMO.  Since the issues are interwined the commercialization of the GM technology is an example of the “chicken-or-the-egg” paradox. 

Editor’s Comment:

The GM approach to in-ovo elimination of cockerels was reviewed in the November 18^th 2021 edition of EGG-NEWS.  The fact that there has been no commercial adoption of the technology in more than four years suggests that acceptance of the genetic approach is highly unlikely, notwithstanding its potential.

In a release dated January 7^th 2026 Cal-Maine Foods Inc. (CALM) announced results for the 2^nd Quarter of FY 2026 ending November 29^th 2025. This review summarizes data provided in the Company release and the concurrently filed SEC 10-Q Report.

Cal-Maine Foods exceeded the analysts’ earnings estimate of $2.08 by 2.4 percent but revenue of $770 million was 5.7 percent below consensus of $814 million.

It is noted that market conditions during Q2 2026 were less favorable compared with Q2 2025 resulting in an average Cal-Maine unit revenue of $2.01 per dozen for all eggs, compared to a corresponding price of $2.74 per dozen, a discrepancy of 26.7 percent. During Q2 The USDA daily average was down 40.8 percent, consistent with a 38 percent fall in the Southeast quotations for Large size as released by the widely used commercial price discovery system. Financial results that were below Street consensus for revenue reduced CALM price from $81.46 at the close on January 6^th by 4.5 percent to $77.50 at the close on January 7^th.

Despite acquiring further-processing enterprises, Cal-Maine still represents a bellwether for the shell egg sector as the only public-quoted company in the industry, supplying close to 20 percent of domestic shell egg consumption and encompassing all varieties. The following table summarizes the results for the period compared with the values for the corresponding quarter of the previous fiscal year (Values expressed as $ x 1,000 except EPS)

Notes: $12.2 million ‘other income,’(excluding interest earned) in Q2 FY2026 compared to $10.9 million in Q2 FY2025:

           $0.2 million gain from non-controlling interest in Q2 2026 compared to $0.7million loss in Q2 FY2025.

 CALM Trailing P/E =3.0.  Beta = 0.24

52-Week Range in Share Price:  $74.74 to $126.40.   50-day Moving average of $85.78

Market close, Tuesday. Jan. 6^th  $79.00 pre-release.

Market open, Wednesday, Jan. 7^th $81.40 but down to $75.14 at noon, closing at $77.50

Shareholding distribution:-  93.0 percent of shares held by institutions; 9.8 percent insiders; 10.6 percent of float was short on December 15^th

In reviewing the CALM Q2 FY2026 report and the SEC 10-Q submission the following values represent key data for the most recent Quarter (with Q2 FY2025 and percentage differences in parentheses for comparison):-

• Conventional shell-egg sales attained $363.9 million in Q2 2026. This category of shell eggs comprised 47.2 percent of total shell egg revenue. ($616.9 million, in Q2 2025, based on 64.9 percent of revenue. Sales value for conventional shell eggs was down 41.0% reflecting lower average unit value for this category).

• Specialty shell-egg sales attained $255.7 million in Q2 2026. This category of shell eggs comprised 37.1 percent of total shell egg revenue. ($287.0 million, in Q2 2025, based on 64.6 percent of revenue. Sales value for specialty shell eggs was down 41.0% reflecting lower average unit value for this category).

• Prepared Foods sales attained $71.7 million in Q2 2026. This category comprised 9.3 percent of total revenue. ($10.4 million, in Q2 2025, based on 1.1 percent of revenue). Sales value for Prepared Foods was up 603% reflecting the contributions of JV Crepini Foods and acquired Echo Lake Foods.

• Egg Product sales attained $34.5 million in Q2 2026. This category comprised 4.5 percent of total revenue. ($30.2 million, in Q2 2026, based on 3.2 percent of revenue). Sales value for Egg Products was up 35.3% reflecting higher volume and average unit value).

• Sales to the Retail Channel attained $625.3 million in Q2 2026, comprising 81.3 percent of total revenue ($810.4 million in Q2 2025, representing 84.8%) Sales to the Food Service sector attained $125.0 million in Q2 2026, comprising 16.2 percent of total revenue ($123.9 million in Q2 2025, +14.0% reflecting sales of Prepared Foods)

• Dozen shell eggs sold (thousands): 322,586 (329,844; -2.3%)

• Average selling price of all shell eggs: $2.014 per dozen; ($2.740 per dozen;            -26.5%).
• Average selling price of specialty eggs (excluding co-pack): $2.396 cents per dozen; ($2.387 per dozen; -0.8%).

• Average selling price of conventional eggs: $1.802 cents per dozen; ($2.943 cents per dozen; -38.8%).

• Differential benefiting specialty eggs over conventional eggs: $0.567 per dozen; (-$0.056 cents per dozen.)

• Specialty eggs as a proportion of volume sold: 37.3%; (36.5%; -2.2%)

• Specialty eggs as a proportion of sales value: 44.0%; (31.7%; +38.8 %)

• Proportion of eggs sold that were produced by Cal-Maine and their contract flocks in Q2 2026: 89.9% (87.3%; +3.0%).

• Feed cost 47.7 cents per dozen (including specialty and breeder diets) (48.3 cents per dozen, down 1.2%)

The Q2-2026 10-Q report contained the following statements on pricing:-

“The majority of our conventional eggs are priced and sold under frameworks that generally utilize market-based formulas tied to independently quoted regional wholesale market quotes. The majority of our specialty eggs are sold under frameworks that do not utilize market-based formulas, although we do have some customers that prefer market-based pricing for cage-free eggs. As a result, specialty egg prices typically do not fluctuate as much as conventional pricing”.

“During first quarter fiscal 2026, a higher proportion of our conventional eggs were sold on a hybrid pricing model that takes into account both our cost of production as well as wholesale market prices, instead of solely market-based pricing, in response to customer demand. We believe the hybrid pricing arrangement may help some customers better plan and manage their businesses and reinforces our role as a trusted supplier. Although hybrid pricing may reduce our profitability when egg prices are high, compared to pure market-based pricing, it could enhance our profitability when egg prices are low, and lead to reduced volatility in our financial results. A majority of our conventional eggs continue to be priced and sold under frameworks that generally utilize market-based formulas tied to independently quoted regional wholesale market quotes”.

The top three customers represented 49.2 percent of sales value, with Walmart and Sam’s Club comprising 33.6 percent in FY 2025.

Presumed Q1 FY 2026 production costs for all categories of shell eggs expressed as cents per dozen (rounded) comprised:-

• Feed               47.7
• Production.    44.9¹
• Nest run.        92.6
• Packing          27.8
• Delivery.          8.1
• Marketing.       4.5
• Overhead.      12.9²      

Total.           145.9³

Notes: 1.0 Provision for pullet depreciation, is presumably included in the ‘production’ expense category

           2.0 Includes General and Administration expenses

           3.0 Divisor 322.6 million dozen sold

Cal-Maine Foods maintained a flock of 49.3 million hens on November 29^th 2025 reflecting acquisitions and growth, with 11.4 million pullets plus parent breeders representing under two percent of the total flock. 

• Effective May 31^st 2025 production capacities comprised:-

• Hens: 51.8 million on 49 farms
• Pullets:14.3 million on 37 farms.
• Packing: 22,490 cph in 50 plants.
• Hatching: 356,300 pullet chicks per week in 2 facilities.
• Parent breeders: 215,000 hens.
• Feed : 1,000 tons per hour in 30 plants.
• Egg products: 72,700 lbs. per hour. 

The following observations relate to the comparison of Q2 2026 with the corresponding Q2 2025:-

• Cal-Maine Foods was not affected by the HPAI epornitic during FY 2025 or thereafter. Management are applying appropriate biosecurity precautions as noted in the Analysts’ call.

• Comparing Q2 2026 with Q2 2025, gross profit was negatively impacted by lower unit revenue for conventional eggs but with minimal effect on specialty eggs. The average 1.2 percent higher feed cost to 47.7 cents per dozen was offset by a 7.4 percent lower cost in the ‘other farm production’ category including labor, consumables and maintenance.
• In a market characterized by low unit prices for conventional shell-eggs, the relative contribution of specialty eggs is more important to net earnings in contrast to an up-market for conventional eggs.

The Q2 press release repeated comments from the Q1 FY 2025 report noting “Significant progress on proactive steps to add production capacity and help mitigate the egg supply shortage across the country, including:

• A 2.6% increase in the average number of layer hens during Q2 2026 compared to the prior-year quarter, reflecting repopulation of flocks and both organic and expansion by acquisition.
• A 12.7% increase in the Company’s breeder flocks during Q2 FY 2026 compared to the end of the prior-year quarter.
• A 65% increase in total chicks hatched during Q2 2026 compared to the prior-year quarter.
• Continued progress on ongoing organic expansion projects that are expected to add approximately 1.1 million cage-free layer hens and 250,000 pullets and contract production of 1.2 million free-range layer hens during FY 2026.
• Added production support through the integration of recently acquired assets”

In the Q2 Cal-Maine release Sherman Miller, president and CEO, commented on the results of the 2^nd quarter of fiscal 2026. He stated, “Cal-Maine is systematically advancing a structural upgrade in the egg category from a position of strength. While the market has long viewed us as a pure commodity business, we are focused on becoming a higher-value, more stable earnings platform as consumer demand shifts toward specialty, premium, and convenient protein solutions. Our core shell-egg business provides a durable foundation, while specialty eggs, more hybrid pricing arrangements, and prepared foods are driving sales mix improvement, deeper customer engagement, and a higher earnings floor with more predictable and resilient results. This is not a pivot—it is a disciplined evolution of an essential food business into a more diversified platform with multiple growth engines and opportunity for improved long-term earnings visibility,” 

Extracts from the 10-Q provided insight into Cal-Maine pricing and marketing including:-

“Our operating results are materially impacted by market prices for eggs and feed grains (corn and soybean meal), which are highly volatile, independent of each other, and out of our control. Generally, higher market prices for eggs have a positive impact on our financial results while higher market prices for feed grains have a negative impact on our financial results. Our pricing for shell eggs is negotiated with our customers on individual terms. We sell our shell eggs at prices based on formulas that take into account, in varying ways, independently quoted regional wholesale market prices for shell eggs, formulas related to our costs of production, such as grain-based and variations of cost-plus arrangements, or hybrid models including cost of production and wholesale market prices”.

“Almost all of our conventional eggs are priced and sold under frameworks that generally utilize market-based formulas tied to independently quoted regional wholesale market quotes or utilize the hybrid models described above. The majority of our specialty eggs are sold under frameworks that do not utilize market-based formulas and instead are based on cost of production, although we do have some customers that prefer market-based pricing for cage-free eggs. As a result, specialty egg prices typically do not fluctuate as much as conventional pricing. We do not sell eggs directly to consumers or set the prices at which eggs are sold to consumers”.

“During the first two quarters of fiscal 2026, a higher proportion of our conventional eggs were sold on a hybrid pricing model that takes into account both our cost of production as well as wholesale market prices, instead of solely market-based pricing, in

response to customer demand. We believe the hybrid pricing arrangement may help some customers better plan and manage their businesses and reinforces our role as a trusted supplier. Although hybrid pricing may reduce our profitability when egg prices are high, compared to pure market-based pricing, it could enhance our profitability when egg prices are low, and lead to reduced volatility in our financial results”.

With respect to production systems and the rate of transition to cage-free housing the Company Q-10 stated “We are focused on adjusting our cage-free production capacity with a goal of meeting the future needs of our customers in light of changing state requirements and our customers’ goals. As always, we strive to offer a product mix that aligns with current and anticipated customer purchase decisions. We are engaging with our customers to help them meet their announced goals and needs. We have invested significant capital in recent years to acquire and construct cage-free facilities, and we expect our focus for future expansion will continue to include cage-free facilities. Our volume of cage-free egg sales has continued to increase and account for a larger share of our product mix”.

“In the second quarter of fiscal year 2026, cage-free egg revenue represented approximately 33.3% of our total shell egg revenue, compared to 23.4% in the second quarter of fiscal year 2025. At the same time, we understand the importance of our continued ability to provide conventional eggs in order to provide our customers with a variety of egg choices and to address hunger in

our communities”.

The Analysts’ call included the following statement by Sherman Miller

“We delivered solid results even against a tough comparison to last year, which was marked by supply-demand imbalances and historically high prices. With lower egg prices, our increasingly diversified business model, combined with effective execution, has proven to be a source of resilience.

That positions us uniquely today, a rare combination of both value and growth, with the potential to strengthen even further over time. Our specialty egg business maintained strong prices and volumes despite challenging comparisons and delivered growth in the first half of the fiscal year. At the same time, our recently announced expansions are positioning our prepared foods business to deliver sustained double-digit volume growth. Another key trend we're seeing is the ongoing shift in our sales mix across the portfolio. This shift was visible throughout the second quarter and first half of the fiscal year, and we expect it will steadily enhance the durability and predictability of our earnings.

It's a direct reflection of the deliberate execution of our long-term strategy. We believe our results continue to reinforce just how effective that approach will be in pursuit of operational and financial excellence”.

“Let me share a few strategic highlights from the second quarter and first half of the year that show how we're driving continued sale diversification and favorable mix shifts. In 2026, shell egg sales represented 84.4% of total net sales compared to 94.7%. Specialty eggs drove a greater portion of shell egg sales, accounting for 44% of total shell egg sales compared to 31.7%. Specialty eggs and prepared foods combined accounted for 46.4% of net sales compared to 31.2%.”

“In 2026, shell egg sales represented 85% of total net sales compared to 94.5% in 2025. Specialty eggs drove a greater portion of shell egg sales, accounting for 39.6% of total shell egg sales compared to 33%. Specialty eggs and prepared foods combined accounted for 42.8% of net sales compared to 32.4%”.

As of April 14^th Cal-Maine Foods ceased to be a “controlled company” with conversion of Class A shares to common stock. As part of the buy-back program the Company purchased shares to the value of $50 million from entities representing the Founder family. Future additional purchases valued at $450 million have been authorized by the Board.

Recent acquisitions include:-

• ISE America was purchased in Q1 2025: for $111.5 million comprised 4.7 million hens, (1.2 million cage-free), pullets, housing, packing plants and other facilities on 4,000 acres in MD., NJ., DE. and SC., representing a unit expenditure of $25/hen with established markets.
• Cal-Maine acquired the remaining 9.2 percent equity in Meadow Creek Foods located in MO. during Q2 FY 2025
• A majority shareholding in Crepini Foods was acquired in Q2 of FY 2025
• Echo Lake Foods was acquired in Q3 FY 2025, effective June 2^nd.
• Feed production facilities were acquired from Deal-Rite Foods in Q3 FY 2025 to supply cage-free contract farms in central North Carolina.
• Clean Egg LLC. In Texas was acquired on October 10^th 2025 for $23.7 million

Capital expenditure on property, plant and equipment during Q1 and Q2 amounted to $92.1 million compared to $65.6 million for the 1^st Half of FY2025.

Cal Maine Foods has expanded by purchase of existing integrated production facilities but has extended acquisitions to value-added products over the past two years.

The 10-Q Report filed on October 1^st 2025 documented approved capital investment of $257.3 million for FY 2026. Provisions comprised a feed mill (3.8% of proposed capital expenditure); Egg products equipment (7.6%); Expansion of prepared Foods (5.8%) and new cage-free housing and conversions (82.8%). Of this total $210.2 million (81.7%) was committed with $47.1 million to be expended.

The USDA Cage-Free Report covering December 2025, was released on January 2^nd 2026, the first edition since October 1^st 2025 covering September

The report documented the complement of hens producing under the Certified Organic Program to be 20.9 million (rounded to 0.1 million), up 0.9 million hens or 4.5 percent since September 2025. The number of hens classified as cage-free (but excluding Certified Organic) and comprising aviary, barn and other systems of housing apparently increased by 2.9 million hens or 2.7 percent from September 2025 to 119.5 million, attributed to expansion, transition from conventional cages and repopulation of depleted flocks.

Extensive depopulation was carried out as a result of HPAI through the fourth quarter of 2024 and continuing in January and February 2025 (31 million), but with lower intensity in March (0.2 million) and April (1.0 million) and a single large complex in Arizona during May (3.8 million). Losses reemerged during late September in a caged-bird complex in Wisconsin (3.1 million hens and 250,000 pullets). Additional depopulations occurred in October, (2.2 million); November, 0.5 million and December, (0.2 million).

Average weekly production for Certified Organic eggs in December 2025 was up 5.1 percent percent (rounded) compared to September 2025 with a high average weekly production of 83.3 percent. Average weekly flock production for cage-free flocks other than Certified Organic was up 2.7 percent in December 2025, with a high average hen-month production of 82.1 percent. Seasonally placed flocks in anticipation of periods of peak demand increase the availability of cage-free and organic eggs, reflecting pullet chick placements 20 weeks previously.

There is no adequate explanation for the elevated production rates recorded other than the high proportion of young hens reaching peak placed in anticipation of December demand. It is also assumed that almost all cage free flocks are in the first cycle of production with negligible molting contributing to the high average in hen-week values compared to caged hens.

Due to the Federal shutdown and temporary cessation of the USDA Egg Markets Overview and available data from the weekly USDA Shell Egg Demand Indicator, the categorization of U.S. flocks according to housing system for December was unavailable among the assumed 290 million producing hens. The breakdown will be provided when data is released.

Losses attributed to HPAI in 2025 comprised:-

Caged flocks, 24.8 million representing 8.4 percent of a nominal 290 million producing hens

Cage-free flocks, 17.6 million representing 5.9 percent of the national flock

Organic flocks, negligible, >0.1 percent

On December 29^th USDA recorded the following National inventory levels expressed in 30-dozen cases (rounded) with the change from September as a percentage of the total quantity of eggs:-

Commodity shell eggs of all sizes. 1,516,800. (-2.7%)

Commodity breaking stock. 404,100. (+17.5%)

Specialty eggs. 45,500. (+16.3%)

Certified organic eggs. 86,900. (-2.6%)

Cage-Free eggs 425,700. (-3.0%) equivalent to 1.5 days production

*Essentially a meaningless value

Negotiated nest-run grade-ready cage-free price for December 2025 averaged $0.88 per dozen, down $0.59 per dozen (-40.1 percent) from $1.47 per dozen in September 2025, reflecting a disturbance in balance between demand and supply.

The December 2025 advertised U.S. featured retail price for Large White cage-free eggs over 1,646 ‘Lower 48’ stores in six regions (NW, NE, SE, SW, MW and SC.) was $2.63 per dozen. This compares with 1,182 stores featuring cage-free Large White in September and reflects more promotions as the year has progressed, consistent with lower demand and increased production. The Decenber 2025 advertised U.S. featured retail price for Large Brown cage-free eggs over 2,819 stores in six regions was $3.43 per dozen with a range of $2.50 per dozen in the SC region to $4.09 per dozen in the SW region. The average promotional shelf price was only 3 cents per dozen above September for this category

The recorded average gradeable nest run price of $0.88 per dozen for brown and white cage-free combined plus a provision of $0.60 cents per dozen for packaging, packing and transport, resulted in a theoretical price of $1.48 per dozen delivered to CDs. The average advertised promotional retail prices of $3.43 per dozen for Brown and $2.63 per dozen for white represented retail margins of 131 percent for featured Brown and 77 percent for White respectively. Fewer promotions were offered for White compared to Brown cage-free by stores reflecting the balance between supply and demand for the two broad categories. Margins are presumed higher for non-featured eggs including pastured and other specialty eggs at shelf prices attaining in excess of $8.00 per dozen in high-end supermarket chains. Retailers are maximizing margins especially on Certified Organic, free-range and pastured categories restricting the volumes of sales, of all categories ultimately disadvantageous to producers and consumers.

This update of U.S egg-production costs and available prices is provided for the information of producers and stakeholders. Statistical data was unavailable for October and November due to the Federal shutdown. Most December figures are now available in this January edition. November cost and price updates provided by the EIC are included in this review for trend comparisons.

DECEMBER HIGHLIGHTS

• December 2025 USDA ex-farm blended USDA nest-run, benchmark price for conventional eggs from caged hens was 122 cents per dozen, down 59 cents per dozen or 32.6 percent from the November 2025 value of 181 cents per dozen. The corresponding December 2023 and 2024 values were respectively $1.56 and $4.24 cents per dozen. For annual comparison, average monthly USDA benchmark price over 2023 was 146 cents per dozen compared to 247 cents per dozen covering 2024. Stock levels and prices prior to the onset of flock depletions due to HPAI indicated a relative seasonal balance between supply and demand. Future nest-run and wholesale prices will be largely dependent on consumer demand for shell eggs and products, as determined by the economy, supply as influenced by flock placements, incidence of HPAI, net imports and the rate of replacement of depopulated pullets and hens and planned depletion. Other considerations include diversion to shell sales from the egg-breaking sector in an interconnected industry.
• Imports of shell eggs continued during the first three quarters of 2025 with the cumulative negative trade balance attaining 19.9 million dozen shell-equivalents through October. During October the positive trade balance in shell-eggs amounted to 7.7 million dozen. For 2025 through October, U.S. liquid and dried products combined achieved a positive trade balance of 15.9 million case-equivalents with October rising to 5.2 million dozen shell-egg equivalents.
• December 2025 USDA ex-farm negotiated USDA nest-run, benchmark price for all categories of cage-free eggs was 110 cents per dozen. The November 2025 value was 147 cents per dozen. The corresponding December 2023 and 2024 values were respectively 287 and 551 cents per dozen.
• Fluctuation in wholesale price is attributed in part to the amplification of upward and downward swings associated with the commercial benchmark price-discovery system in use. An important factor influencing pricing is the proportion of shell eggs supplied under cost-plus contracts. A high proportion of available eggs in this category accentuates the upward and downward price trajectory of uncommitted eggs as determined by the price discovery system. Extreme fluctuation is exemplified by high prices prevailing in the 1^st quarter of 2025 and low values during December 2025 and January 2026. The price differential does not reflect relatively small changes in available production or presumed demand.
• The response to highly pathogenic avian influenza as distorted by the price discovery system was the major driver of prices in 2024 and through 2025 due to the high seasonal incidence rates. Approximately 40 million hens and at least 2.0 million pullets were depleted in 2024 with close to an additional 45 million birds, (hens and pullets) in both large complexes and contract farms through 2025. The Fall 2025 losses involved complexes of 3.1 million hens in late September and 2.0 million in early October. During November 570,000 hens producing table eggs were depopulated on 22 farms in close geographic proximity with flock losses averaging 24,000 per event. This suggested the vulnerability of contract producers of cage free eggs with common risk factors including feed supply and egg collection. This trend is a departure from losses involving a few very large complexes evident in the wave of cases during early fall months.
• December 2025 USDA average nest-run production cost for conventional eggs from caged flocks over four regions (excluding SW and West), applying updated inputs was 75.5 cents per dozen, down 0.2 cents from November 2025 at 75.7 cents per dozen as influenced by feed cost. The December average nest run production cost for other than caged and certified organic hens was estimated by the EIC to be 95.1 cents per dozen down 0.2 cents per dozen from November. Approximately 60 cents per dozen should be added to the USDA benchmark nest-run costs to cover processing, packing material and transport to establish a realistic cost value as delivered to warehouses.
• December 2025 USDA benchmark nest-run margin for conventional eggs attained a positive value of 46.5 cents per dozen compared to a positive margin of 105.3 cents per dozen in November 2025. Year to date the average monthly nest-run production margin has attained 172 cents per dozen. Average nest-run monthly margin for 2024 was 170.8 cents per dozen compared to 64.2 cents per dozen in 2023 and 155 cents in 2022.
• December 2025 USDA benchmark nest-run margin for all categories of cage-free eggs was 14.9 cents per dozen compared to a positive margin of 40.9 cents per dozen in November 2025. Through December the average monthly nest-run production margin attained 293 cents per dozen. Average nest-run monthly margin over 2024 was 440 cents per dozen compared with 100 cents per dozen in 2023, relatively unaffected by HPAI compared to the preceding and following years.
• The December 2025 national flock (over 30,000 hens per farm) was stated by the USDA to be up by 4.2 million hens (rounded, and a probable undercount) to 290.1 million compared to 285.9 in August. There were approximately 326 million hens before the advent of the H5N1 epornitic of HPAI in 2022. Approximately 3.5 million hens returned to production from molt during the month together with projected maturation of 23 million pullets, with the total offset by depletion of an unknown number of spent hens. On January 14^th USDA estimated the total U.S table-egg production flock at 300.0 million with 293.4 million actually in production.
• November 2025 pullet chick hatch of 26.0 million was down 2.7 million (-9.4 percent) from October, inconsistent with an increased industry need to replace depopulated flocks.
• October export data is reviewed in a companion article in this edition. In October 2025 exports of shell-eggs and products combined were up 26.4 percent from September 2025 to 459,200 case equivalents representing the theoretical production of 6.8 million hens. Shell egg exports totaling 162,000 cases were dominated by Canada (80 percent of volume) the “Rest of Americas” including the Caribbean (6 percent). With respect to 297,000 case- equivalents of egg products, importers comprised the E.U (26 percent), Canada (16 percent of volume), “Rest of Americas and the EU (each 20 percent), Japan, (24 percent), Mexico, (7 percent) collectively representing 79 percent of shipments. Volumes exported are based on the needs of importers, competing suppliers, availability in the U.S. and FOB prices offered.
• For 2025 through October the negative trade balance in all shell and derived egg products attained 4.1 million dozen shell equivalents.

TABLES SHOWING KEY PARAMETERS FOR DECEMBER 2025.

Summary tables for the latest USDA December 2025 costs and unit prices were made available by the EIC on January 16^th 2025. Data is arranged, summarized, tabulated and compared with values from the previous December 9^th 2025 release reflecting November 2025 costs and production data, as revised and applicable. Monthly comparisons of production data and costs are based on revised USDA and EIC values.

VOLUMES OF PRODUCTION REFLECTING THE ENTIRE INDUSTRY

1. From USDA Weekly Shell-egg Demand Indicator January 14^th 2026

*Source USDA/EIC Note 1. Texas excluded to maintain confidentiality 

PROPORTION OF U.S. TOTAL HENS BY STATE, 2025

Based on a nominal denominator of 300 million hens in flocks over 30,000 covering 95 percent of the U.S complement.

USDA has amended inclusion of specific states in regions and eliminated Texas data to protect confidentiality of Company flock Sizes

1. Values rounded to 0.1%

Rate of Lay, weighted hen-month (USDA) 81.5 September 2025.  81.8 % November 2025

*Revised USDA

*Revised, using data from USDA Livestock, Dairy and Poultry Outlook January 16^th 2026 taking into account demand from the food service sector and presumably including the effect of HPAI depopulation and net importation.

EGG INVENTORIES AT BEGINNING OF DECEMBER 2025:

EGGS BROKEN UNDER FSIS INSPECTION (MILLION CASES) October 2025, 7.03 November 2025, 6.58

EXPORTS OCTOBER 2025: (Expressed as shell-equivalent cases of 360 eggs).

*Representing 2.2 percent of National production in OCTOBER 2025 comprising 35% shell, 65% products.

COSTS AND UNIT REVENUE VALUES¹ FOR CONVENTIONAL EGGS FROM CAGED HENS

Notes: 1. Excludes SW and West representing an important deficiency 

Components of Production cost per dozen:-

Ex Farm Margin (rounded to nearest cent) according to USDA values reflecting December2025:-

122.0 cents per dozen¹- 75.5 cents per dozen =46.5 cents per dozen (November 2025 comparison: 181.0 cents per dozen – 75.7 cents per dozen = 105.3 cents per dozen.

Note 1: USDA Blended nest-run egg price

1. Unrealistic USDA values based on advertised promotional prices with few participating stores, non-representative of shelf prices!

AVERAGE COSTS AND UNIT REVENUE FOR EGGS FROM CAGE-FREE HENS

Components of Production cost for cage-free eggs, per dozen:-

Ex Farm Margin (rounded to cent) according to USDA values reflecting negotiated price for December 2025:-

Cage-Free brown 110.0 cents per dozen¹- 95.1 cents per dozen =14.9 cents per dozen

November 2025:-  Not disclosed

1. Contract price, nest-run loose. Range 155 to 210 c/doz. Negligible change since July 2024 and totally unrealistic.
2. Negotiated price, loose. Range $0.40 to $1.90 per dozen
3. Estimate based on prevailing costs
4. Unrealistic USDA values based on promotional prices with few participating stores and non-representative of shelf prices

* Conventional (non-organic) feed

Feed prices used are the average national and regional values for caged flocks. Excludes organic feeds with prices substantially higher than conventional.

On January 16^th 2026 the USDA Economic Research Service (ERS) issued actual values for egg production during 2024 with an updated projection for 2025 and a forecast for 2026. Production, consumption and prices were revised from the previous December 15^th 2025 report.

Projected egg production for 2025 was adjusted downward from 7,737 million dozen in 2024 by 4.8 percent to 7,366 million dozen due to progressive depletion of hen flocks as a result of HPAI. Heavy losses occurred during Q1 2025  with incident cases extending through December totaling 42.3 million hens for the year. The per capita consumption of shell eggs and liquids combined for 2025 will be 259.2 eggs, down 11.4 egg equivalents (-4.2 percent) from 2024. The projected average 2025 benchmark New York bulk unit price was raised 70 cents per dozen over 2024 to 374 cents per dozen. On January 16^th the price was 72 cents per dozen reflecting both increased supply and depressed consumption in that market. Subsequent USDA projections will provide greater clarity on the recovery in consumption in an economy that is undergoing inflation in all food categories with the outstanding exception of eggs, even with retailers maintaining high margins and failing to pass on savings to consumers.

Restoration in flock size after HPAI depletions in 2022 progressed at a net rate of approximately 1.0 million per week offset by losses due to depopulation. Placements were limited by the availability of pullet chicks and for some producers, by the rate of conversion to alternative housing systems. Restoration of the national flock was compromised by a resurgence of HPAI with 40.0 million layers depleted during 2024 but with replacement averaging 24 million pullets per month. On December 31^st the total egg-producing flock was estimated by USDA to be 301 million hens, 25 million or 7.7 percent below the nominal flock averaging 326 million hens during 2021 before the onset of the ongoing HPAI epornitic. Effective January 16^th the total national flock attained 300.0 million, approximately 26 million (-8.0 percent) below the pre-HPAI level. The productive flock was estimated by the USDA to be 293.4 million on January 14^th. Cage-free flocks during December attained 140 million or 46.6 percent of the total. In the January report the Egg Industry Center confirmed a total flock of 302.8 million at the end of December 2025. Unpredictable factors affecting flock size and hence price will include consumer demand as influenced by recently lower shelf prices for generic eggs and the extent of possible losses during the early winter months of the current year.

Exports of eggs and products at approximately 1.8 percent of total production over the first ten months of 2025 attained 104.5 million dozen shell-egg equivalents. This was offset by imports of 108.7 shell egg-equivalents. Exports did not materially affect the domestic price. The U.S. is currently a net importer of egg products and shell eggs for breaking amounting to 4.2 million shell-egg equivalents. Future export volume will be encouraged by low domestic prices and bthe the needs of importing nations but will be constrained by international competition and disease-related embargos.

The USDA forecast for 2026 includes production of 7,900 million dozen, up an optimistic 7.2 percent from 2025. Projected consumption will be 273.7 eggs per capita. This forecast presumes substantial control of HPAI and an adequate supply of replacement chicks and pullets. These are both speculative assumptions in the absence of approved vaccination in high-risk areas. The increase, if it were to become reality would depress the NY Large benchmark price to an average of $1.20 per dozen compared to the 2025 value of $3.73 per dozen for conventional Large white-shelled product in cartons.

Updated January 2024 USDA data is shown in the table below:-

*Data influenced by HPAI losses.

Sourcs:   Livestock, Dairy and Poultry Outlook released January 16^th 2026

The volume of exports of shell eggs and products is conditioned by the domestic needs of importers, price against competitors and regulatory disease and logistic restraints. Imports are determined by domestic needs with reduced supply due to flock depopulation as the principal driving factor during the first 10 months of 2025.

USAPEEC data reflecting volume of exports for shell eggs and egg products are shown in the table below comparing 2024 with 2025:-

U.S. EXPORTS OF SHELL EGG AND EGG PRODUCTS DURING

JANUARY-OCTOBER INCLUSIVE IN 2025 COMPARED WITH 2024

*The data published by USDA for shell eggs are slightly different from USAPEEC figures included in this table.

For the ten-month period Canada was the export destination of 71.3 percent of U.S. shell eggs followed by the Caribbean at 14.7 percent. For egg products the four major importers collectively comprised 78.4 percent of volume with the relative proportions represented by Japan (28.3%); Canada, (15.7%), Mexico, (16.7%) and the EU, (17.7%).

According to the USDA Egg Markets Overview, January 9^th, shell eggs exported over 10 months attained 50.2 million dozen. This represents the average production of 2.5 million hens or 1.6 percent of the current population of producing hens. All egg products including liquid and dried, attained 54.3 million dozen shell equivalents for a total of 104.5 million dozen shell equivalents over ten months. Imports over the same period comprised 70.1 million dozen shell eggs for breaking and 38.5 million dozen shell egg equivalents over all product forms for a total of 108.7 million dozen shell equivalents

Net trade deficit was therefore 4.2 million dozen shell equivalents

The trade situation during 2026 will be influenced by the needs of importers, a fluid tariff situation, landed price and availability. Since supply has increased in volume with a sharp decrease in domestic price, imports will be curtailed with an expectation of higher exports consistent with a more competitive situation.

Activist Watch recently reported on the annual earnings of executives at the two leading U.S. not-for-profit “animal welfare” organizations. 

The top 14 at Humane World for Animals (previously HSUS) collectively earned $4.3 million with an average of $307,000 and a range of $202,000 to $677,000 paid to CEO Kitty Block. 

Among the 14 top ASPCA executives, the collective earnings value was $7.1 million with an average of $507,000 and a range of $328,000 to $1.2 million paid to CEO Matt Bershadker.

In contrast the CEO of the nation’s largest egg producer earned $1.2 million with a relatively low base salary and a supplemental incentive bonus based on performance criteria.  The CEO directs the Company with a market capitalization of $3.8 billion with total assets of $3.1 billion and annual sales exceeding $2.8 billion and a head count of approximately 3,800.  The CEOs of the two non-profits do not reflect the responsibilities, accountability and required experience, training and acumen of CEOs of large agribusiness companies responsible to shareholders.

Dr. Jarra Jagne received the Cornell University College of Veterinary Medicine Daniel Elmer Salmon Award for Distinguished Alumni Service in a ceremony on October 10, 2025.  This award recognizes the contributions of Dr. Jagne to the profession, the College and community.

Dr. Jagne is a native of The Gambia in West Africa and earned her DVM degree at Cornell in 1990. After returning to her home country as a veterinary and project officer she contributed to the advancement of livestock production and especially the economic status of women.

She subsequently returned to the U.S. and completed a residency program at the University of Pennsylvania gaining diplomate status in the American College of Poultry Veterinarians.

She was appointed to the Veterinary College at Cornell where she managed the avian diagnostic laboratory and also assisted the then Babcock subsidiary of Hendrix Genetics in management of breeding stock.  She has served as a senior veterinary advisor for the U.S. Agency for International Development working on avian influenza.

In 1919, Aramark introduced to the U.S. training in aspects of food service for prisoners as an extension of the IN2WORK program. It is estimated that worldwide over the past ten years, as many as 20,000 individuals have received Aramark training in food preparation and presentation. Depending on training and electives, graduates of the program are eligible for a ServSafe Manager certification from the National Restaurant Association or a Certified Specialist Certificate from the National Retail Federation in Supply Chain, Inventory and Logistics.

The Kansas Department of Corrections (KDC) encouraged prisoners to undertake training in food safety and sanitation, nutrition and food preparation leading to certification as a fundamental cook offered by the American Culinary Federation. Training while incarcerated in Kansas has allowed 224 individuals to graduate from the Aramark program allowing rehabilitation and the prospect of becoming a productive member of society after release. Previously the KDC cooperated with a major egg-producer in the state to provide staff for a packing plant. The Hickman operation in Arizona employed prisoners as workers in construction, packing and layer-house operations with benefits to the Company and participants. Many of the workers were offered permanent positions after parole or release. This is an activity that deserves emulation providing there is training, prospects for future employment and without exploitation.

Tim Barttrum president and CEO of Aramark Correctional Services stated “We always look for opportunities to make a difference and IN2WORK does just that. It has been a privilege to see it grow from a feature we offer as an integral part of our mission.”  Since its launch in 1999 IN2WORK has been implemented in 32 states with more than 292 programs and has graduated more than 14,000 students.

The Consumer Price Index (CPI) for December 2025 released on January 13th was unchanged from 2.7 percent in November. This said, the accuracy of the monthly figures may have been distorted by the October federal shutdown. The food-at-home category was up 2.4 percent compared to food- away-from home category at 4.1 percent, reflecting escalation in labor, packaging costs and overhead. Cereals and Bakery products were up 1.5 percent. The Meats,  Poultry, Fish + Eggs segment was up 3.9 percent. Within this category, eggs were definitely not a contributor to inflation, given the relatively low wholesale prices that prevailed during December and as compared to 2024. Margins imposed by retailers evidently contributed to unjustified high cost to consumers. As noted, food inflation in December was in excess of the headline CPI. Frozen fish + seafood was up 8.6 percent.

An economist at a major rating agency noted, “Inflation is still uncomfortably high with staples, and necessities remaining elevated. The headline December CPI reading was influenced by a 3.4 percent decline in the price of gasoline. This reflects lower crude prices passed on through the refining infrastructure. Piped gas service was the outstanding increase at 10.8 percent compared to December 2024. This was attributed to high demand during a cold period in relation to regional availability and restraints on distribution. Other categories influencing the CPI included nonalcoholic beverages at 5.1 percent, vehicle maintenance repair (5.4 percent) and tobacco products at 6.8 percent.

Many of the items with a high rate of inflation, including roasted coffee at 17 percent reflect the effect of tariffs that to date have been largely absorbed by importers and distributors. It is possible that goods inflation will become more apparent later in the first quarter of 2026 as predicted in public comments by voting members of the Federal Reserve FOMC. This has implications for establishing interest rates. 

Genomic sequencing has provided data on the differences in origin of H5N1 clade 2.3.4.4b H5N1 isolates affecting flocks in North and South America respectively.  A team based in Argentina in collaboration with colleagues at the University of California, Davis, National Institutes of Health and the Robert Koch Institute in Germany conducted the analyses. It was concluded that H5N1 strains circulating in North America from 2021 onwards represented re-seeding by numerous introductions from Europe and Asia that underwent reassortment with low-pathogenicity avian influenza viruses giving rise to novel genotypes designated B, C and D. It was determined that outbreaks in South America during 2024 were derived from a single introduction of H5N1 virus from North America. 

The South America H5N1 introduction resulted in infection of marine mammals with obvious contagion in a number of species of seals and sea lions.  This was due to the B3.2 virus acquiring mammalian-adaptive polymerase basic mutations (Q591K and D701N) absent in North American H5N1 isolates.

*Vanstrels, R. et al. Avian influenza A (H5N1) virus Argentina, 2025. Emerging Infectious Diseases. doi.org/10.3201/eid3112.250783.

Shortly after the emergence of bovine influenza H5N1 it was determined that the virus was sensitive to pasteurization but remained stable in raw milk at 4C for an extensive period.  A recent study* showed that virus demonstrated enhanced thermal stability in milk derived from infected udders compared to milk from noninfected cows subjected to spiking.  Raw milk from infected cows remained infectious for five weeks when stored at 4C with only a two-log reduction in titer. Virus could be detected in stored milk applying PCR assay for up to 22 weeks.

In contrast virus isolates from infected cows when spiked into raw milk from healthy cows yielded virus for only two weeks.  Five other influenza viruses spiked into milk from healthy cows showed a similar rapid decay rate. 

H5N1 virus derived from infected cows showed slightly higher thermal stability in milk compared to spiked samples in milk from noninfected cows.  From a practical standpoint, pasteurization inactivated virus at 63C for five minutes or at 72C for 30 seconds.

The authors noted that milk derived from infected cows could serve as a vehicle of infection as evidenced by the occurrence of clinical symptoms in farm workers contaminated with infected milk. This has obvious implications for disposal of contaminated milk.  The authors could not provide a hypothesis relating to the enhanced thermal stability and persistence of viability in milk from contaminated udders compared to virus in spiked raw milk from non-infected cows.

*  Guan, L. et al Stability of avian influenza (A-H5N1) virus to milk from infected cows and virus-spiked milk N.Engl.J.Med 2025: 393:2271-2273 (2025)

The 2026 Peak Exhibition organized by the Midwest Poultry Federation will take place over April 14 through 16 in the Minneapolis Convention Center.

The program will include the progressively-expanding tradeshow incorporating TED talks. Other program activities will comprise educational sessions, entertainment coupled with fellowship and collegial interaction.

The January 2026 USDA Dietary Guidelines for Americans reflect the unorthodox and scientifically questionable policy of the leadership of the Department of Health and Human Services as influenced by political activists and the MAHA movement.  The Dietary Guidelines are revised at five-year intervals and serve as a guide for health professionals and also determine the composition of federally funded or supported school meals. 

The 2026 Dietary Guidelines were developed by an independent advisory committee selected by HSUS and USDA administrators.  The significant features include:

• A focus on protein - increasing intake and promoting red meat, poultry and eggs at the expense of plant-based protein.

• Inclusion of animal fats - with a limit of saturated fat to ten percent of calories equivalent to 22 grams per day.

• An emphasis on nutrient-dense food groups including fruits, vegetables, animal protein and dairy products.

• Limits on “highly processed foods” and a reduction in sugar intake

The depiction of the food pyramid is now inverted compared to previous presentations with dairy and meat products and eggs at the top and whole grains at the bottom.  The detail in the 2026 Guidelines was reduced from the previous edition comprising 264 pages to only 10 pages. This suggests urgency in preparation, inexperience among compilers and a lack of scientific rigor. It is evident that questions will be raised concerning the review of scientific literature prior to drafting of the report by privately contracted individuals with questionable credentials.