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egg industry
Trump FTC Urged to Probe Egg Giants Reaping 'Dramatic' Profits by Keeping Prices High
"Evidence indicates that by not increasing their supply, the five dominant egg firms are forcing prices to stay high while reporting dramatic profit increases and level sales," according to the group Farm Action.
Feb 12, 2025
An advocacy group dedicated to fighting corporate agriculture monopolies on Wednesday urged federal antitrust enforcers to take action against egg producers that the group accuses of taking advantage of the bird flu crisis in order to raise prices, inflate their profits, and consolidate their market power.
What's more, the slow recovery of "flock size"—the total number of egg-laying hens—"despite historically high prices, further suggests coordinated efforts to restrict supply and sustain inflated prices" that warrants investigation, according to a letter sent by Farm Action president Angela Huffman to Federal Trade Commission Chair Andrew Ferguson and Acting Assistant Attorney General Omeed Assefi, who has been tapped to temporarily lead the DOJ antitrust division.
The letter, which invokes the behavior of "dominant egg producers," largely provides data on one company, Cal-Maine Foods, the biggest producer and marketer of shell eggs in the country.
Separately, Democratic voices are urging the Trump administration to take action around corporate conduct as it relates to food prices. FTC Commissioner Alvaro Bedoya, a Biden appointee, has also urged Ferguson to open an investigation into egg production and marketing practices—pointing to a 2023 request from Farm Action to the FTC to investigate potential antitrust violations in the egg industry.
And last week Sen. Elizabeth Warren (D-Mass.) wrote that she had sent President Donald Trump a list of ways he "can use his executive authority to tackle high food costs by focusing on corporate profiteering."
Egg prices have risen starting in 2022, coinciding with the arrival of bird flu in the United States, and are likely to keep rising in 2025.
The wholesale price of "Grade-A, Large, White, Shell Eggs" rose from $0.50-$1.30 per dozen in 2021 to $1.50-$5.00 per dozen in 2022, and then eased in 2023 before climbing up again in 2024. As of January 2025, the national index of weekly prices for that same type of eggs was up to $6.00-$8.00 per dozen, according to Farm Action.
"The previous all-time high [for wholesale prices] was late December 2022 heading into Christmas, when we touched $5.46 per dozen," Ryan Hojnowski, a market reporter at Expana, wrote in an e-mail to CNBC. "Of course we have blown way past that this time."
Retail prices have also increased. Retail prices for large, Grade-A eggs reached an average of $4.25 per dozen in December 2022 after never reaching above $3 a dozen in the 2010s. Retail prices declined in 2023 and then rose again throughout 2024, reaching $4.15 per dozen in December of last year.
Farm Action argues that while bird flu has been cited as the main driver for rising egg prices, its actual impact on production has been minimal. According to the letter, bird flu has forced the culling of roughly 115 million egg-laying chickens, but the impact of these losses on the total size of the U.S. supply of egg-laying flock has been "relatively modest." Huffman wrote that this culling has caused egg production to drop from 8.1 billion eggs per month in 2021 to 7.75 billion eggs per month at the end of 2024.
But crucially, according to the letter, per capita production of eggs has not been below per capita consumption of eggs in any year between 2022 and the present—while the total value of egg production has risen from $8.8 billion in 2021 to $17.9 billion in 2023.
Cal-Maine specifically has seen its profits soar. The company tallied gross profits of $179.6 million in fiscal year 2020, but the producer reported $1.2 billion and $541.6 million in gross profits in fiscal year 2023 and 2024, respectively, according to the letter. Between fiscal year 2020 and fiscal year 2024, sale levels have remained fairly consistent, wrote Huffman.
"Evidence indicates that by not increasing their supply, the five dominant egg firms are forcing prices to stay high while reporting dramatic profit increases and level sales. These same firms are then using their increased profits to acquire their competition, further driving market consolidation instead of investing in replenishing or expanding their flocks," Farm Action wrote in a statement on Wednesday.
As evidence, they cite a number of mergers that took place in the industry in 2023, and point to the fact that the top five egg producers' share of the "U.S. layer hen flock" increased from 37% to 46% between 2023 and 2025.
"There appears to be a remarkable unwillingness among large egg producers to invest in the internal reconstruction or expansion of their egg-laying flocks in response to persistently high prices," wrote Huffman, which she contrasts with the quicker flock recovery that took place during the first bird flu outbreak in 2014-2015.
The "lagging recovery" and "the fact that egg producers are showing unusual discipline in their pricing and output decisions" indicates that market forces are not "operating as they should be." The letter suggests a few factors that may contribute to the lack of competition.
The group is urging the two agencies to launch investigations, specifically encouraging the FTC to launch an investigation into pricing and production practices of dominant egg producers and their hatchery suppliers to make sure the market is "truly free and fair."
This is far from the first time that the food and grocery industry has been accused of inappropriately raising prices.
In August 2024, a top executive at the supermarket chain Kroger even admitted under questioning from a Federal Trade Commission attorney that the grocery chain raised its egg and milk prices above the rate of inflation.
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FTC Urged to Crack Down on Egg Industry's 'Organized Theft'
"Contrary to industry narratives, the increase in the price of eggs has not been an 'act of God,'" says Farm Action. "It has been simple profiteering."
Jan 19, 2023
As U.S. egg producers rake in record profits amid soaring prices, a farmer-led advocacy group focused on building a just and sustainable food system on Thursday implored the Federal Trade Commission to "promptly open an investigation into the egg industry, prosecute any violations of the antitrust laws it finds within, and ultimately, get the American people their money back."
Just before testifying at an open meeting of the FTC, Farm Action sent a letter to agency chair Lina Khan detailing its "concerns over apparent price gouging, price coordination, and other unfair or deceptive acts or practices by dominant producers of eggs such as Cal-Maine Foods, Rose Acre Farms, Versova Holdings, and Hillandale Farms, among others."
As Farm Action explained, "Egg prices more than doubled for consumers last year—going from $1.79 in December 2021 to $4.25 in December 2022 for a dozen large Grade A eggs."
Major egg producers and their allies have blamed surging prices on a "supply disruption" triggered by the deadliest outbreak of avian influenza in U.S. history, calling it "'act of God' type stuff," the letter notes.
Based on its analysis of publicly available industry data, however, Farm Action determined that while the avian flu outbreak killed roughly 43 million egg-laying hens nationwide in 2022, "its actual impact on the egg supply was minimal."
According to the letter:
After accounting for chicks hatched during the year, the average size of the egg-laying flock in any given month of 2022 was never more than 7-8% lower than it was a year prior—and in all but two months was never more than 6% lower. Moreover, the effect of the loss of egg-laying hens on production was itself blunted by "record-high" lay rates observed among remaining hens throughout the year. With total flock size substantially unaffected by the avian flu and lay rates between 1-4% higher than the average rate observed between 2017 and 2021, the industry's quarterly egg production experienced no substantial decline in 2022 compared to 2021.
Nevertheless, the "weekly wholesale price for shell eggs climbed from 173.5 cents per dozen at the end of February to 194.2 cents in the middle of March," the letter continues. "By the first week of April, it had reached 298 cents per dozen. For two months after this point, the wholesale price of eggs appeared to stabilize at elevated levels slightly below this peak—but then it started increasing again. In July, it broke previous records and reached over 300 cents per dozen. After dipping briefly in August, the rally in wholesale egg prices continued, hitting 400 cents per dozen in October and almost 450 cents per dozen in the first weeks of December."
According to Farm Action, major egg producers' massive price hikes are unjustifiable. In addition to the avian flu outbreak, some have attributed skyrocketing egg prices to higher feed and fuel costs, but "the dominant producers' course-of-business documents suggest these claims have little merit," the letter states. "For example, in a presentation to investors just this month, Cal-Maine noted that total farm production and feed costs in 2022 were only 22% higher than they were in 2021."
"What Cal-Maine Foods and the other large egg producers did last year—and seem to be intent on doing again this year—is extort billions of dollars from the pockets of ordinary Americans."
"The real culprit behind this 138% hike in the price of a carton of eggs," says the letter, "appears to be a collusive scheme among industry leaders to turn inflationary conditions and an avian flu outbreak into an opportunity to extract egregious profits reaching as high as 40%."
Max Bowman, the chief financial officer of Cal-Maine—the nation's largest producer and distributor of eggs—has admitted as much, saying in a recent statement that "significantly higher selling prices, our enduring focus on cost control, and our ability to adapt to inflationary market pressures led to improved profitability overall."
CNNreported last week that "there have been no positive tests" of avian flu at any of Cal-Maine's facilities, and yet the company's net average selling price per dozen conventional eggs more than doubled last year. The corporate giant, which controls roughly 20% of the egg market, is behind several popular brands, including Farmhouse Eggs, Sunups, Sunny Meadow, Egg-Land's Best, and Land O' Lakes eggs.
"Contrary to industry narratives, the increase in the price of eggs has not been an 'act of God'—it has been simple profiteering," Farm Action's letter argues. "For the 26-week period ending on November 26, 2022, Cal-Maine reported a 10-fold year-over-year increase in gross profits—from $50.392 million to $535.339 million—and a five-fold increase in its gross margins."
"Cal-Maine's willingness to increase its prices—and profit margins—to such unprecedented levels suggests foul play. That Cal-Maine—the leader in a mostly commoditized industry with, presumably, the most efficient operations and the greatest financial power—will quintuple its profit margin in one year without any compelling business reason is plainly an indication of market power," the letter continues. "It is also an invitation for rival egg producers to tacitly collude with Cal-Maine, forego price competition themselves, and maintain high prices for the entire industry. Fundamentally, Cal-Maine seems to be engaging in price leadership—using the avian flu outbreak and the inflationary conditions of the past year as cover to establish a new 'focal point' for egg prices."
"This pattern of behavior by the dominant firms in the egg industry raises significant concerns about monopoly power and potential antitrust violations in this sector," the letter adds. "It also presents exactly the kind of monopoly or oligopoly power that is entrenched in a market 'with highly inelastic demand' and that 'imposes substantial costs on the public,' which Chair Khan has previously argued enforcers should seek to challenge. We urge the FTC to exercise the full scope of its authorities—under the Sherman, Clayton, and FTC Acts—to identify, challenge, and uproot anti-competitive arrangements that suppress competition among egg producers and enable dominant firms like Cal-Maine to extort consumers for the eggs they need every day."
In November, "antitrust trailblazer" Khan led the agency in issuing a new policy statement restoring its commitment to "rigorously enforcing" the FTC Act's prohibition on "unfair methods of competition," including what critics have called "predatory pricing."
According to Farm Action: "What Cal-Maine Foods and the other large egg producers did last year—and seem to be intent on doing again this year—is extort billions of dollars from the pockets of ordinary Americans through what amounts to a tax on a staple we all need: eggs. They did so without any legitimate business justification. They did so because there is no 'reasonable substitute' for a carton of eggs. They did so because they had power and weren't afraid to use it."
"This kind of organized theft is exactly what Congress—and the public it represents—'empowered and directed' the FTC to prevent," the group concluded. "The FTC should do nothing less."
In addition to regulatory action, Sen. Bernie Sanders (I-Vt.) argued last weekend that Cal-Maine's "corporate greed" exemplifies why "we need a windfall profits tax."
\u201cCorporate greed is the producer of Egg-Land's Best, Farmhouse Eggs & Land O'Lake Eggs, increasing its profits by 65% last quarter to a record-breaking $198 million while doubling the price of eggs & reporting no positive cases of avian flu. Yes. We need a windfall profits tax.\u201d— Bernie Sanders (@Bernie Sanders) 1673804220
Last March, Sanders introduced the Ending Corporate Greed Act, which seeks to stamp out price gouging by imposing a 95% tax on the windfall profits of major companies.
Progressive economists have long urged Congress and the Biden administration to enact a windfall profits tax, strengthen antitrust enforcement, and impose temporary price controls, arguing that only these measures—and not the Federal Reserve's unemployment-inducing interest rate hikes—can address the corporate profiteering underlying the cost-of-living crisis.
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The Egg Industry, Scrambling
Dec 30, 2015
Americans eat about 265 eggs per person per year, according to the American Egg Board, and roughly nine in 10 are laid by hens confined in cages with little room to move.
That's changing. McDonald's, Dunkin' Donuts, General Mills and Nestle all said this fall they are gradually switching to cage-free eggs in the US. Consumers are buying more cage-free and organic eggs. Laws in five states, including California, ban caged hens.
But what do terms like "cage-free" and "organic" really mean? Not what you might imagine. According to a new report from the Wisconsin-based Cornucopia Institute, a nonprofit that promotes organic food policy and farming, eggs labeled "organic" or "cage-free" can be produced in industrial-sized barns by hens that rarely see the light of day. No wonder consumers are confused.
The challenge for large-scale egg producers is clear. Their corporate customers and regulators are demanding that they convert to more expensive, cage-free methods. Less than 9% of US hens (there are 277 million of them in all) are now raised without cages, according to United Egg Producers, a trade group. Rose Acre Farms and Rembrandt Foods, the US's second-and third-largest egg producers, are among those expanding their cage-free operations. "The change is humongous," Marcus Rust, CEO of Rose Acre, told the AP.
Smaller companies that supply cage-free and organic eggs face challenges, too. As the industry shifts to cage-free, companies like Pete & Gerry's, Egg Innovations, The Happy Egg Co and Wilcox Farms will need to find new ways to set themselves apart. Some will promote their eggs as "free range" or "pastured", terms that, unlike "cage-free", mean that chickens get access to the outdoors.
Consumers, in the meantime, may need to look beyond labels. The Cornucopia Institute report includes a scorecard ranking 136 name-brand and private-label egg producers. Shoppers concerned about animal welfare may want to look for certifications from independent nonprofits like Animal Welfare Approved and Certified Humane.
No more jailbirds
Many of these changes have been driven by animal welfare groups like the Humane Society of the United States (HSUS). They won an epic battle in 2008 when California voters passed Proposition 2, a ballot measure that, among other things, required that all egg-laying hens raised in the state by 2015 be able to turn around and extend their wings. That meant abolishing conventional cages, which give each hen just 80 square inches of space in which to move, roughly the footprint of a laptop computer. Later, California lawmakers required that all shell eggs sold in the state be produced in compliance with Proposition 2.
"It was at that point that the egg industry realized that the status quo was not sustainable," says Josh Balk, HSUS's director of food policy. Since then, four states - Michigan, Ohio, Oregon and Washington - have enacted laws banning or restricting the use of wire cages. A sweeping animal welfare law is headed for the ballot next year in Massachusetts.
HSUS also has helped persuade more than 100 companies, including the US's three biggest food service firms, Aramark, Sodexo and Compass Group, to phase out caged eggs. The McDonald's promise in September to switch to cage-free eggs in North America over the next decade has been deemed a turning point by many, mostly because the company and its franchisees buy more than 2.1bn eggs a year.
The egg industry has fought the legislative mandates, arguing that banning cages will cost producers and consumers more, without improving animal welfare. But Chad Gregory, president of United Egg Producers, acknowledges that conventional cages are on the way out, for better or worse.
"Choices are being taken away from consumers by animal rights groups like the Humane Society of the United States," Gregory says. "You are increasing the cost of a high-quality protein significantly, sometimes doubling or tripling it."
He's not far off. On a recent visit to a Giant supermarket in suburban Washington DC, Pete & Gerry's organic free-range eggs were selling for $5.79 a dozen, Nature's Promise Naturals, a store brand, large cage-free eggs were selling for $3.49 a dozen, and a dozen conventional Giant eggs were priced at $2.99.
Some consumers willingly pay higher prices. Pete & Gerry's, for example, has grown by 20% or more a year since converting to organic and cage-free about 15 years ago. "We rose out of the ashes of the conventional egg business," says Jesse LaFlamme, the company's co-owner and CEO, who is Gerry's son. The company has expanded from a single New Hampshire farm into a network of about 100 family farms in the northeast and mid-Atlantic states to meet growing demand.
Not all eggs are created equal
Terms like "organic" and "cage-free", however, don't mean that hens spend their days bathed in sunshine and pecking at grass in a farmyard. "Cage-free" means only that hens are not kept in cages; they can still spend all their lives indoors. The organic label requires that farmers need to use organic feed and create access to the outdoors, but big farms can comply by building small porches around hen houses with as many as 150,000 to 200,000 birds.
The Cornucopia Institute is especially critical of large farms that use the organic label, but give birds extremely limited access to the outdoors, citing such brands as Chino Valley Ranchers, Eggland's Best, Horizon Organic and Land 'O Lakes. The researchers took aerial photographs of large organic egg farms and found few, if any, hens outside.
That violates the spirit of the organic standard, says Mark Kastel, Cornucopia's co-founder. Factory farmers who use the organic label are "misrepresenting themselves to consumers and injuring ethical farmers", Kastel says. "They are inconsistent with what consumers expect in terms of the humane treatment of animals, environmental standards and support for family farmers." The Cornucopia scorecard points consumers to smaller, family-owned farms that allow hens to spend all of their time on pasture; about 35 smaller firms earn the top "Five Egg" ranking.
Ranked in the middle are mid-sized producers like Pete & Gerry's, Wilcox Farms and Egg Innovations. They face a difficult challenge - explaining to consumers that their practices are superior to those of big organic farms and better than cage-free.
Pete & Gerry's relies in part on third-party verification. Its eggs are Certified Humane by an independent nonprofit and it was the first farm business in the US to become a certified B Corporation, according to LaFlamme.
"We have our work cut out for us in a category that's very confusing," LaFlamme said. "We are, to a degree, hanging our hat on the differentiation between cage-free and free range. But what we're really counting on is our brand."
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