The US Justice Department has launched an investigation into major egg producers over the dramatic rise in egg prices, which have reached record highs in recent months.
Investigators are examining whether these companies have coordinated to increase prices by sharing information about supply and pricing.
This comes after the avian flu outbreak disrupted the egg supply, causing a surge in prices.
Egg prices have doubled since January 2024, with the national wholesale price for a dozen eggs rising to over $8 in some places.
Recently, however, the Department of Agriculture reported a slight drop in the national average wholesale price to $6.85 per dozen.
Despite this decrease, many consumers have yet to see relief at the retail level, with grocery stores continuing to sell eggs at high prices.
Emily Metz, president and CEO of the American Egg Board, representing egg producers nationwide, has denied any suggestion of price gouging, DailyMail said.
Metz explained that egg farmers are "price takers, not price makers," meaning they don't control the prices but are responding to market forces, such as the reduced egg supply caused by bird flu.
"The tight egg supply caused by avian influenza, coupled with 23 consecutive months of high sales volume, has created a perfect storm in egg markets," she stated.
In response to rising egg costs, the Department of Justice has opened an antitrust inquiry to see whether major producers have banded together to boost prices or restrict supply.
— Wall Street Mav (@WallStreetMav) March 9, 2025
Time to see what is going on with the Egg price Spike. pic.twitter.com/XpRXqtPunQ
Lawmakers Urge Probe Into Egg Price Hikes, Citing Potential Price-Fixing
While egg producers defend the price increases as necessary due to the pandemic and avian flu, some lawmakers and advocacy groups have raised concerns.
Senator Elizabeth Warren and other Democratic lawmakers have called for an investigation into what they see as a possible exploitation of the avian flu crisis to artificially inflate prices.
They argued that the large profits reported by major egg companies, such as Cal-Maine Foods, suggest that the price hikes may not be entirely justified.
Cal-Maine Foods, the largest egg producer in the US, has seen a dramatic rise in profits, attributing the increase to higher egg prices driven by bird flu.
According to ABC7, the company reported a 342% increase in its gross profits for the second quarter of fiscal 2025.
In its recent filings, Cal-Maine explained that higher egg prices, along with rising grain costs, contributed to this boost in profits. However, this isn't the first time the company has faced legal scrutiny.
Cal-Maine was found guilty in 2023 of price-fixing in a case that resulted in millions of dollars in fines.
Farm Action, an advocacy group for farmers, has applauded the Justice Department's investigation.
They believe that some egg producers may have purposely slowed down the repopulation of egg-laying hens to maintain higher prices.
This follows a similar case in 2023, where egg producers were found guilty of limiting supply to drive up prices.
In the midst of rising prices, the US Department of Agriculture has pledged to invest up to $1 billion to address the egg price issue, including $500 million aimed at improving biosecurity.
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