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Producer Price Index Confirms Decline in Egg Prices

12/05/2023

The November 15th release of the Producer Price Index issued by the U.S. Bureau Labor of Statistics denoted the sharp decline in egg prices from highs in October 2022, during the HPAI recovery phase, to the corresponding month in 2023.  Over the twelve months, egg prices at the farm level declined by 59.7 percent.  Year to date egg prices declined by 28 percent.  In contrast, egg prices increased by 17.1 percent in 2021 due to increased demand as a result of COVID buying patterns. Prices increased by 163.1 percent in 2022 attributed to HPAI depletion. 

 

For 2023, the USDA Economic Research Service forecast a 31.8 percent mid-range decline in farm egg price in 2023.  For 2024 a 25.7 percent decline was projected with an understandably wide range from -70.0 percent to +95.9 percent.  Uncertainty is obviously a reflection of the unpredictability in the future incidence of HPAI.  The price-elasticity of eggs is denoted by a 160 percent increase in farm price during 2022 against an average reduction of 10 percent in supply. Availability of shell eggs was constrained by two seasonal waves of infection resulting in depopulation of a total 44 million hens. Biphasic mortality resulted in an approximately 22 million reduction in the national producing flock on a constant weekly basis.