Sean Dengler. PHOTO BY SOREN M. PETERSON

It is genuinely concerning when egg prices are this high. These prices are hitting levels never touched before, and this is for a critical food item a lot of people rely on. From restaurants to home cooking, eggs are used in many dishes. Their higher price means a higher cost for many people. Unfortunately, the avian bird flu is only a symptom of the main cause of these higher prices.

Consolidation across the chicken and egg industry is causing these prices. The first part of this issue is the consolidation of meatpackers and egg producers – forcing farmers to go big or go home. It is more advantageous to build bigger and bigger facilities with more chickens. I did not do a statistical analysis, but I bet the number of chickens in these buildings is higher than at any point in history. This puts these large numbers of birds at risk when avian bird flu comes knocking. This also means fewer farmers have a chance to raise these birds.

If the birds were spread out in more facilities, it could reduce the risk of the avian bird flu and build a more resilient system. This would lead to fewer birds being impacted and prices being held stable. Policies have been put in place in the past and can be put in place again to help protect farmers from the onset of consolidation. This will help farmers, help rural communities, and build resiliency in the food system.

The second part of the consolidation issue is creating competition in the egg industry. According to Farm Action, when the avian bird flu happened last time in 2022, the highly consolidated egg producers took advantage. For example, Cal-Maine Foods, whose market share is 20%, increased their gross profits in lockstep with rising egg prices. While input costs were claimed as an excuse for this reason, their gross margins increased steadily from 19% in the first quarter of 2022 to nearly 40% in the last quarter of 2022. During this time, they sold the same number of eggs.

Comparing these prices to when the industry had a bird flu outbreak in 2015, which was relatively more severe, the total number of egg-laying hens recovered from the losses at less than one-third the pace than in 2015. In 2015, egg prices rose 6-8% for every 1% decrease in the number of egg-laying hens. In 2022, this was 15% for every 1% decrease.

Something smells fishy. As the industry has continued to consolidate, it allows these larger producers to profiteer during these tough times. By breaking up these companies and creating more competition, it will lead to better prices and more opportunities for farmers. Companies will be forced to compete on price and not be lethargic at building back their flocks/herds. Markets should be free and fair and not taken advantage of by only a handful of companies. The United States has enforced these laws before, and we can enforce them again.

Taking on consolidation on the front and back end of the market will help farmers and citizens receive better profits and better prices. Livelihoods will be improved across the board. Lowering the prices of eggs is important, and the first step is to create competitive markets. This will help stop profiteering during times of crisis and create a resilient food system.

Sean Dengler is a writer, comedian, farmer, and host of the Pandaring Talk podcast who grew up on a farm between Traer and Dysart. You can reach him at sean.h.dengler@gmail.com.