KANSAS CITY — While retail shell eggs in the United States and egg product supplies used by US food manufacturers have eased back from record highs set in December 2022, analysts expect egg values to remain elevated worldwide through 2023, especially in markets hardest hit by the still active highly pathogenic avian influenza (HPAI) outbreak, the primary driver behind soaring prices last year. But other supply and demand factors were providing support, specifically the rising cost of feed.
Egg prices have reached record-high price levels in many markets, Rabobank said in a recent report.
“Rabobank’s global egg price monitor reached a new record in Q1 2023, with the index now peaking above 250, which means prices are 2.5 times higher than the reference year of 2007, and have increased more than 100% since this time last year,” said Nan-Dirk Mulder, senior analyst – animal protein at Rabobank,
“Feed represents 60% to 70% of a layer farmer’s costs, so any change or uncertainty surrounding feed costs affects egg prices and supply,” Mr. Mulder said.
Additional price influences include sustaining COVID-19 effects on operations, production restrictions due to new regulations, and changes in purchasing behavior from an inflation-pressured consumer. Also, the HPAI virus continues to circulate. While no HPAI outbreaks have been detected in commercial laying hen flocks so far in 2023 (the disease has been detected in other commercial and non-commercial poultry), its ongoing presence remains a lingering risk to egg suppliers, and the uncertainty surrounding the virus outlook is fueling firmer prices.
The “egginflation” has been a uniquely global phenomenon, according to Rabobank. In addition to the United States, Europe, Brazil, Mexico, Japan, the Philippines and New Zealand have all concurrently experienced historically high egg prices in recent months. While prices globally are expected to maintain higher levels, some countries will see prices soften sooner. These include countries that have experienced extreme price peaks, like the United States, Europe and Japan. While their values may pull back from all-time highs, prices are not expected to sink to levels that typically follow a crisis.
Areas with higher levels or increased risk for HPAI, or operations with limited access to financing, will continue to see sharply elevated prices. Restrictions on breeding stock as well as countries undergoing regulatory changes, like Germany, will also limit price reductions.