Why A US Farm Group Is Accusing Egg Companies Of Unfair Pricing
We've heard a lot about the dramatic increase in egg prices over the last year, and for good reason. Eggs are a staple in many households in the U.S.; according to Statista, the predicted per-capita consumption for 2022 was 288 eggs per person, meaning that, on average, people eat eggs more days than they don't. Increases in egg prices are worse in some parts of the country than others since some states like California and Colorado passed legislation requiring larger enclosures and more room for egg-laying hens — measures that inevitably increase prices.
How much have egg prices gone up? According to Time, it's a lot. In the U.S., the average cost of a dozen eggs is currently $4.25, which is a staggering increase of 138% since last January when they were just $1.79. Given the pervasive effects of sky-high egg prices on individual families and restaurants (particularly breakfast restaurants), it's no surprise that Farm Action, an advocacy group working to mitigate the effects of "monopolistic corporate control" over food production and pricing, has, according to Time, shined a light on the real reasons for the dramatic increase in the price of eggs over the last year and is calling for change.
Farm Action has asked the FTC to investigate egg pricing
Reuters reports that Farm Action sent a letter to the chair of the Federal Trade Commission (FTC) asking the agency to investigate whether price gouging is occurring in the egg industry, citing, in particular, the record-high profits of the nation's largest egg company, Cal-Maine Foods. Cal-Maine, which supplies roughly 20% of eggs sold at retail, reported quarterly gross profits that reflected more than a 600% increase over the same period last year.
While Cal-Maine's statement to Reuters claimed the higher prices it charged for eggs resulted from increased production costs, along with the effects of avian flu, Farm Action disputes the truth of those claims. Farm Action's letter to the FTC points out that the company recently told investors that production costs had increased just 22% for 2022 over the previous year. The advocacy group also points out the conspicuous absence of price competition among Cal-Maine's competitors, amounting to "a tax on a staple we all need: eggs."
Time also notes that Cal-Maine's most recent quarterly report showed zero avian flu outbreaks at any of its facilities, calling into question the company's justification for its high retail prices. Citing a documented history in the egg industry of "cartelistic conspiracies" to keep production low while increasing prices to consumers, Farm Action implored the FTC to stop what it called the "organized theft" of billions of dollars from consumers.