The U.S. Department of Justice has initiated an investigation into rising egg prices, probing whether major egg producers may have colluded to artificially inflate prices or limit supply.
Data from the Bureau of Labor Statistics reveals a 15.2% increase in egg prices between December and January, with an even steeper rise of 53% from January 2024 to January 2025. The cost of a dozen Grade A large eggs reached an average of $4.95 in January, marking a dramatic 139% jump from October 2023, when the price was just $2.07.
The DOJ has issued letters to certain egg companies, requesting them to retain records of any discussions concerning pricing with both competitors and customers, as well as any correspondence with Expana, a group that tracks wholesale egg prices, The Wall Street Journal reported on Friday, citing sources familiar with the matter.
The letters also expressed interest in the companies’ communications about egg production and the impact of the avian flu. The investigation is still in its early stages, and it remains unclear whether it is being pursued as a civil or criminal case.
Lisa Phelan, an antitrust attorney at Morrison Foerster, explained that antitrust regulators typically launch investigations when significant price hikes appear to be linked to exceptional disruptions in the supply chain. “There can be anticompetitive efforts to deal with the crisis and that is not OK either,” she added.
Many point to the ongoing avian influenza epidemic, which has devastated poultry populations, as a major factor behind the surge in egg prices. This outbreak led to the culling of over 150 million chickens, turkeys, and egg-laying hens, a measure mandated by the U.S. Department of Agriculture (USDA), according to The Journal.
The USDA has made it clear that there is no cure for the highly pathogenic avian influenza, and the only way to control its spread is through the mass euthanasia of affected poultry.
Egg producers have faced challenges in replenishing their flocks, particularly as even young birds, known as pullets, have been killed by the virus. This has extended the time needed for recovery from an outbreak, with some producers facing delays of up to a year, compared to the previous recovery period of about six months. Emily Metz, CEO of the American Egg Board, a marketing organization supported by the egg industry, shared this information with The Journal.
“Farmers know people are frustrated and they are frustrated too by the situation,” Metz said. “They know they are not able to put on the volume of eggs that people want.”
The persistent egg shortage, coupled with continued demand despite the price hikes, has stretched suppliers to their limits, resulting in empty egg cartons on store shelves. Grocery stores have identified the lack of eggs as a significant contributor to the rise in food prices, which has hindered former President Donald Trump’s efforts to lower overall inflation, which stood at 3.0% in January, according to the Consumer Price Index.
The USDA recently announced plans to allocate up to $1 billion to address rising egg prices, including $500 million for enhanced biosecurity measures at egg farms, as reported by The Journal.
Cal-Maine Foods, the largest egg producer in the U.S. and one of the few publicly traded companies in the sector, has seen its profits rise with the soaring egg prices. The company’s stock has increased by approximately 50% over the past year, following the bird flu outbreak.
The egg industry has faced scrutiny from organizations like Farm Action, which has urged lawmakers and law enforcement to look into egg pricing practices. The group accused egg producers of deliberately delaying the rebuilding of their egg-laying flocks to limit supply and maintain inflated prices. Some egg producers, however, argue that rebuilding flocks takes time, and they aim to avoid further outbreaks at their facilities.
{Matzav.com}The post As Eggs Keep Getting Costlier, the DOJ Launches a Price-Fixing Probe first appeared on Matzav.com.