Jan 12, 2024
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In 2023, Americans were perplexed by the soaring prices of something extremely basic yet essential: eggs.
According to data from Google Trends, eggs were the most frequently searched “why is … so expensive” item in the U.S. in 2023.
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This concern transcended geographical boundaries. Egg prices worried people across the entire nation. Remarkably, in all 50 states and D.C., eggs dominated the rankings as the most searched item.
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According to Axios, this marks the first time a single topic has achieved such nationwide ubiquity.
So what’s the situation with egg prices in America?
Data from the Bureau of Labor Statistics showed that in January 2023 the average price of a dozen large Grade A eggs was $4.82, a 150% increase from January 2022.
However, as 2023 progressed, the price of eggs decreased from its January peak. By December, the average price of a dozen large Grade A eggs was $2.50.
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Has America won the war against inflation?
The headline inflation rate has also been cooling off.
In December U.S. consumer price index increased 3.4% from a year earlier. This is a substantial decrease from the peak in June 2022, when the annual increase in consumer prices hit an alarming 9.1%.
Many experts believe that inflation is no longer a concern in America.
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In October, Nobel laureate Paul Krugman declared victory over inflation in a post on X, formerly known as Twitter.
“The war on inflation is over. We won, at very little cost,” Krugman wrote.
Jeremy Siegel, professor of finance at the Wharton School of Business, had a similar view.
“We are not going to have any more inflation,” Siegel said in a November interview with CNBC.
However, keep in mind that while the rate of inflation is no longer at a 40-year high, the prices of many necessities remain elevated. The latest CPI report showed that, over the last year, the food index increased 2.7% and the shelter index rose 6.2%.
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Will egg prices ease in 2024?
Returning to the pressing issue of egg prices, those hoping for a price drop may need to temper their expectations.
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The reason? Bird flu.
Cal-Maine Foods (CALM), the largest producer and distributor of shell eggs in the U.S., recently announced that it has temporarily ceased production at a facility in Kansas after the facility tested positive for “highly pathogenic avian influenza.”
Cal-Maine Foods said that approximately 684,000 laying hens, or approximately 1.6% of the company’s total flock, were affected.
“There have been no positive tests for HPAI at any other Cal-Maine Foods locations to date. Cal-Maine Foods believes it has implemented and continues to maintain robust biosecurity programs across all its locations,” the company said in a press release.
According to the U.S. Department of Agriculture, as of Dec. 20, 77.19 million birds have been affected since the avian flu outbreak began in February 2022. HPAI has been detected in 1,044 flocks across 47 states.
Should the outbreak persist and further reduce the hen population, consumers may have to prepare for continued high egg prices.
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Jing is an investment reporter for MoneyWise. He is an avid advocate of investing for passive income. Despite the ups and downs he’s been through with the markets, Jing believes that you can generate a steadily increasing income stream by investing in high quality companies.
