U.S. farm groups recommend that high egg prices be investigated

By Leah Douglas

(Reuters) – The Federal Trade Commission (FTC), should investigate high egg prices to determine if there are signs of price gouging by top egg companies. This is because Americans continue paying more for this household staple than ever before.

The argument between U.S. regulators and farmers has been repeated in recent years. They argue about the power that top agriculture firms have to set prices and drive up the grocery price. This was evident when the beef price soared in 2021.

According to the Bureau of Labor Statistics eggs are currently a concern. They went up 138% in December compared to a year ago and now cost $4.25 per dozen.

The U.S. Department of Agriculture (USDA), has cited a record outbreak of Avian Flu as the reason for high prices. Farm Action, in a letter addressed to Lina Khan, the chair of the FTC on Thursday, suggested that the antitrust regulator examine the record-high profits at the country’s top egg company.

Cal-Maine Foods which controls 20% in the retail egg market reported quarterly sales increases of 110% and greater gross profits than the same quarter last fiscal year according to a December filing with Securities and Exchange Commission.

The company filed a statement pointing out that avian influenza had caused a decrease in egg supply across the country, which led to higher prices. This was the reason for the record-breaking sales. The company has not had any positive avian flu testing on any of its farms.

U.S. egg production fell by 5% in October, compared with last year. Egg inventories dropped 29% in December, according to the most recent USDA data. This is a significant drop but it may not be the reason for record-high prices. Basel Musharbash of Farm Action, an attorney, stated that egg production in the United States was down 5% in October.

Musharbash declared, “We want to see if consumers are being priced out by the FTC.”

The FTC declined to comment. Cal-Maine didn’t respond to a request.

American Egg Board, a marketing organization for eggs, stated in a statement that egg price reflect many factors and that wholesale egg prices have begun to fall.

According to USDA, avian flu has claimed the lives of nearly 58 million turkeys and chickens. The virus was introduced in 2022 to try to stop the spread. It is most prevalent between March and April. 50.5 Million birds died in the 2015 outbreak.

Cal-Maine shares fell in recent weeks, after rising nearly 50% last year.

(Reporting and Editing by Leah Douglas; Editing By Bill Berkrot