Why are egg prices suddenly cracking? A mix of market shifts, supply changes and seasonal demand could mean big news for grocery shoppers

Some relief may finally be on the way, as the wholesale egg prices have started to fall.

However, Easter and a lag between the changes in wholesale and consumer prices may mean that relief doesn't come immediately for frustrated grocery shoppers, many of whom have struggled with high food inflation since the pandemic.

Here's why egg prices are finally falling

Egg prices peaked due to a deadly outbreak of bird flu that spread across the United States, resulting in the death of millions of egg-laying chickens. Major producers may also have engaged in alleged anti-competitive behavior to drive prices up, prompting an antitrust investigation by the Department of Justice in March.

The good news is that outbreaks of bird flu appear to be becoming less frequent. Additionally, high prices have weakened consumer demand, with many people choosing to forgo purchasing eggs due to record costs. Some buyers, fearing further price increases from continued bird flu outbreaks, also stockpiled eggs, reducing future demand further. With higher supply and lower demand, prices have begun to drop.

“Slowing outbreaks are leading to improved supply availability and wholesale market prices have responded with sharp declines over the past week,” the USDA wrote.

The drop in wholesale egg prices has been significant, with the cost per dozen dropping 44% from its mid-February peak. Wholesale prices are now $4.83 per dozen instead of $8.58 per dozen, according to Expana, which tracks agricultural commodity prices.

Karyn Rispoli, an egg market analyst and managing editor at Expana, told CNBC via email that prices had plunged due to market dynamics placing "extreme pressure" on the cost per dozen.

The Trump Administration also initiated a plan to help lower prices, including investing $500 million in biosecurity improvements, providing more indemnity payments to farmers, reducing regulations and importing more eggs to increase supply.