Egg costs are rising once more. The perpetrator, once more: chook flu.
At least, that’s the surface-level purpose. In the present wave, according to the CDC, the H5N1 chook flu has been present in over 90 million poultry birds throughout almost each state since 2022, and has even unfold to dairy cattle, with over 30 herds in 9 states coping with an outbreak on the time of this writing.
The final time chook flu struck US farms, in early 2022, egg costs greater than doubled in the course of the 12 months, reaching a peak of $4.82 for a dozen in January 2023. During the chook flu outbreak in 2014 to 2015, egg costs additionally briefly soared.
While costs now are nonetheless nowhere close to the height they reached in January 2023, they’ve been creeping up once more since final August, when a dozen large eggs cost $2.04. As of March, we’re bumping up in opposition to the $3 mark, which is a virtually 47 p.c improve. It’s additionally an enormous improve from the value we have been used to some years in the past: In early 2020, a dozen eggs have been simply $1.46 on common.
The H5N1 pressure of chook flu is very contagious and clearly poses a giant threat to hens. But the truth that chook flu outbreaks preserve battering our meals system factors to a deeper drawback: an agriculture trade that has turn out to be brittle due to intense market focus.
The egg market is dominated by some main gamers
The egg trade, like a lot of the agricultural sector, is commanded by just a few heavyweights — the most important, Cal-Maine Foods, controls 20 percent of the market — that go away little slack within the system to soak up and isolate shocks like illness.
Hundreds of 1000’s of animals are packed tightly collectively on a single farm, as my colleague Marina Bolotnikova has defined, the place illness can unfold like wildfire. According to the federal government and company accountability group Food & Water Watch, three-quarters of the nation’s a whole lot of thousands and thousands of egg-laying hens are crammed into just 347 factory farms.
The system additionally makes use of genetically comparable animals that farms consider will maximize egg manufacturing — however that lack of genetic diversity means animal populations are much less immune to illness.
When a hen will get contaminated, stopping the unfold is an ugly, cruel business; since 2022 it has led to the killing of 85 million poultry birds. For the patron, it usually means paying much more than normal for a carton of eggs.
Preventing any outbreaks of illness from ever occurring isn’t sensible, however the mannequin of contemporary industrial farming is making outbreaks extra disruptive.
And it’s not simply these disruptions driving worth spikes. Egg producers additionally look like benefiting from these moments and climbing costs past what they’d want to keep up their old revenue margins.
“It is absolutely a story of corporate profiteering,” says Rebecca Wolf, senior meals coverage analyst at Food & Water Watch.
Cal-Maine’s web revenue in 2023 was about $758 million — 471 p.c increased than the 12 months prior, in line with its annual financial report. Most of this fortune was made by way of hoisting up costs; the variety of eggs offered, measured in dozens, rose solely 5.9 p.c.
Last 12 months, a number of meals conglomerates, together with Kraft and General Mills, have been awarded almost $18 million in damages in a lawsuit alleging that egg producers Cal-Maine and Rose Acre Farms had constrained the availability of eggs within the mid- to late 2000s, artificially bumping costs. A farmer advocacy group last year referred to as on the FTC to look into whether or not prime egg producers have been worth gouging shoppers.
Are we doomed to semi-regular worth surges for eggs?
Our meals system didn’t turn out to be so consolidated — and fragile — by chance. We acquired right here due to three massive causes, Wolf says: by not imposing environmental legal guidelines, by not imposing antitrust legal guidelines, and by gifting away “tons of money” to the agriculture trade.
During the New Deal period, the federal authorities put in place insurance policies that may assist handle meals provide and shield each farmers and shoppers from sharp deviations in what the previous earned and the latter paid. Under Secretary of Agriculture Earl Butz within the Nineteen Seventies, although, those policies started getting chipped away; Butz’s well-known motto was for farmers to “get big or get out.” The unfold of large manufacturing facility farms is partially a product of this about-face in managing provide.
Because our meals system is so concentrated and intermingled, it additionally means any single provide chain hiccup — whether or not because of illness, wars, or another purpose — can have ripple results on others, affecting costs in an unlimited variety of important client items and providers. “When we have things like E. coli outbreaks, it’s hard to know where the problem lies because the way that we process and manufacture is so hyper-industrialized that you then have a problem with millions of pounds of food,” says Wolf.
Thankfully, the Biden administration has been making some strides in loosening up meals trade consolidation, usually by shoring up enforcement of long-existing antitrust laws. But there’s nonetheless extra we might do. There are payments which have been launched to Congress, like Sen. Elizabeth Warren’s Price Gouging Prevention Act, that may give the FTC the authority to first outline what counts as worth gouging after which crack down on corporations that increase costs excessively.
The cycle of meals chain snags and better costs doesn’t need to preserve repeating.
“We are maximizing profit truly over everything else — over the welfare of the animals, over the rights and wages of people who work in the food system, for even consumers who are at the grocery store,” Wolf says. “None of this is inevitable — we shouldn’t have to be here.”
This story appeared initially in Today, Explained, Vox’s flagship day by day e-newsletter. Sign up right here for future editions.
