No crack in egg inflation as price climbs 15% in January, latest report show
Whether it’s chocolate chips, butter, flour or brown sugar, the cost of ingredients Danielle Paschka uses to make cakes, cookies and bread is up.
But no item on her shopping list has increased in price more than the price of eggs, which rose 15% from December to January as millions of laying hens were slaughtered to curb the spread of bird flu.
Left unchecked, the disease could decimate the egg industry, in which Iowa leads the nation. But the preventive measures are leaving consumer gasping as they pay as much as 70 cents apiece for an item that in recent memory typically went for 12 cents or less.
Overall egg prices are up 53% from the same time last year, according to the Consumer Price Index, which measures inflation.
And the latest CPI report, released Wednesday, shows that despite President Donald Trump's promise he would bring prices down on “Day 1” in office, prices are again on the upswing, rising last month at the fastest pace since August 2023.
Eggs are only the most prominent harbinger, with prices on everything from coffee to energy increasing and steel and aluminum prices expected to follow after Trump's move this week to slap tariffs on imports of the metals.
Paschka of West Des Moines, a self-taught baker who's made a profession of being a social media influencer of baking fans, makes countless baked goods, most of which she gives away to her friends and family. But the cost of baking and feeding her two girls and husband is taking a bite out of her budget.
"I hope that eventually it will level out," Paschka said. "I used to think that $3 per dozen was crazy. But I would love to get back to that spot."
Food prices were up 0.5% in January and 2.5% in the last 12 months, according to the CPI data. With her hungry, growing daughters ages 8 and 10, Paschka said, "I can definitely feel the increasing in pricing when feeding the girls."
No food item's price has increased more than that of eggs.
The December-to-January egg price increase was the largest since June 2015, during another widespread U.S. bird flu outbreak. And it accounted for two-thirds of the total monthly food increases, the Bureau of Labor Statistics, which tracks the CPI, wrote in a report.
"Butter is expensive, eggs are expensive. I need to look at what I'm wanting to bake now. I don't want to bake something with six eggs," Paschka said.
Why are egg prices so high?
Highly pathogenic avian influenza has forced farmers to cull 157 million laying hens, turkeys, broilers and other birds since the current outbreak began in 2022, U.S. Department of Agriculture data shows.
Topping states in losses has been Iowa, the nation’s largest egg producer, with nearly 30 million birds destroyed. Bird flu cases have been reported in 22 Iowa counties in commercial and backyard flocks of chickens as of Feb. 4, according to the U.S. Centers for Disease Control and Prevention.
Since November 2023, more than 12.1 million birds in commercial flocks have been affected in Sioux County alone. In flocks where bird flu is detected, all birds are destroyed to prevent the spread of the disease.
In one instance in 2022, 5.3 million hens at a Buena Vista County egg-producing facility were destroyed after bird flu was detected there.
The price of U.S. wholesale eggs hit an all-time high in December, according to commodity data firm Expana, with a dozen eggs going for an average of $5.57 in the Midwest and $8.85 in California.
American Egg Board CEO Emily Metz told the Des Moines Register in a statement that 14 million hens have been lost nationwide in just the past four weeks.
Making matters worse is that demand for eggs is highest around Thanksgiving, Christmas and in winter in general. And egg demand has increased for 23 consecutive months, Metz said.
“The reality is the system for egg production is both complex and time sensitive," she said. "These two forces combined — tight supply and high demand — are directly causing the spike in wholesale prices we’ve seen recently, as well as intermittent shortages of eggs at some retail locations and in different parts of the country."
At the same time supplies have fallen, the “cost of doing business" has risen, said Lee Schulz, chief economist at Ever.Ag, a Texas-based consulting firm, and a former Iowa State University economics professor.
Schulz cited the rising costs for inputs like feed, labor and other requirements of tending egg-laying flocks. In addition, he said, there's been no price-suppressing decline in sales.
“Demand for eggs is very inelastic” because “there’s not a lot of substitutes for them,” he said.
Paschka has made at least one adjustment. Making white cakes requires separating egg whites from yolks, and "two years ago I would've just gotten rid of the yolk," she said.
Now she buys containers of egg whites, "Which are cheaper than a dozen eggs right now," she said.
But her family still has eggs for breakfast, she said. And the price of another breakfast staple also is on the rise.
Coffee prices are at their highest levels since the 1970s because of a drought in Brazil, the top coffee-producing nation, and a drought followed by floods in Vietnam, which produces the second-most coffee worldwide.
Since September 2023, the price of arabica, the most commonly consumed type of coffee, has risen from $1.83 per pound to an all-time high of $4.04 per pound, with much of that increase — 45% — coming in the past four months, according to the federal reserve bank of St. Louis.
Energy costs also rose 1.1% in January, and gas prices were up 1.8%, according to the CPI report.
How have grocers have been impacted?
Across the grocery industry the supply of eggs is tight, said Fareway spokesperson Elias Johnson. Unlike some grocers, Fareway is not limiting the number of eggs customers can buy, Johnson said.
“Our suppliers are struggling to keep up with demand on varieties like organic, pasture-raised, cage-free and free-range eggs the most,” Johnson said. “The conventional white egg supply is tight, but we are securing enough product to handle our customer's needs.”
The price hikes likely aren't over. A U.S. Department of Agriculture forecast predicted in January that the price of eggs would increase 20% by the end of the year.
Paschka previously decorated cakes for Hy-Vee, and her husband, works as a vice president for the chain. So they try to shop exclusively at West Des Moines-based chain.
With prices increasing across the grocery industry, Paschka looks around at other chains to see the best price for her ingredients. But she still shops exclusively at Hy-Vee because of her family's ties to the chain.
“Everything is high.” she said. “I now am on this sourdough kick. So I’ve been making sourdough. So now I’m having to get tons of flour. Luckily with sourdough you only need water, flour and the starter that I have. So I don’t need a ton of ingredients. But still, flour is expensive.”
Iowa Egg Council plans to give away eggs at State Fair
No matter how high egg prices go, one tradition won't be affected.
The Urbandale-based Iowa Egg Council still plans to give away hard-boiled eggs on a stick at this summer's Iowa State Fair, said Melissa Alto-Kintigh, a spokesperson for the trade group. The council gives away about 170,000 eggs during the fair from its booth in the John Deere Agriculture Building.
Sioux Center-based Versova, one of the world's largest egg producers, already has committed to donating the eggs, Alto-Kintigh said. Michael Foods, which has a plant in Norwalk that produces egg patties for fast-food sandwiches, typically processes the hard-boiled eggs, she said.
The restaurant industry doesn't typically give away food. But Iowa Restaurant Association President Jessica Dunker said many restaurateurs have been absorbing at least some of the rising cost of eggs to keep their prices relatively reasonable.
Dunker sounded an optimistic note, saying laying hens go from chick to adult in about two months. So the restaurant industry may be able to ride out the shortage.
“If they can replenish the flocks and keep them healthy, the restaurant industry has been here before and we know that’s a short-term problem,” she said. “The restaurants that I’m speaking to are going to most of try to hold off on increasing prices for what we know to be a temporary problem.”
Laying hens take 5-7 months to start laying eggs, according to Iowa State University Extension.
This story was updated to correct incorrect information.
Staff writer Donnelle Eller, Reuters and USA Today contributed to this article.
Philip Joens covers retail and real estate for the Des Moines Register. He can be reached at 515-284-8184, pjoens@registermedia.com or on Twitter @Philip_Joens.