Egg prices have risen to levels not seen since late 2015 in some parts of the country, suggesting that supply is realigning with demand after a disease outbreak killed millions of U.S. chicken a couple of years ago.
Retailers, however, are resisting the industry's push by taking losses on eggs to draw customers.
Ken Shea, Bloomberg senior analyst of food and beverages, said retailers such as Wal-Mart and Aldi are willing to take a modest loss on some staples -- like milk and eggs -- if that means more people are going into the store to buy other items.
The U.S. Department of Agriculture reported last week that egg prices in U.S. stores have risen steadily over the past month to meet increased seasonal demand.
Recent data show the national average for Grade A white eggs rose from 90 cents per dozen to $1.27, from Oct. 25 to Nov. 21.
Regionally, Midwest large egg prices are up 79 cents per dozen, or 75.2 percent from October lows, according to Urner Barry, a commodity market publisher.
Bloomberg data showed that U.S. egg prices have been strong over the past five months.
"They're bouncing back from a depressed level," Shea said.
In 2015, a reported 35 million laying hens and turkeys, or about 12 percent of the national inventory, were destroyed because of the highly contagious avian flu. It was the worst food-related outbreak in U.S. history, nearly three times the size of the 1983 outbreak.
Immediately afterward, egg prices jumped to $3 per dozen as production rates plummeted by about 1.2 billion eggs, according to the USDA.
To make up for lost eggs, farmers raised a surplus that drove retail prices to record lows, said Hongwei Xin, director of the Egg Industry Center in Iowa.
In June, some stores in the Southern U.S. stocked eggs that were priced under 50 cents a dozen -- lows not seen in about a decade.
Xin said he's hopeful that purchasing habits will continue to eat at the industry's supply as prices increase.
"Because of the low price, there's increased consumption and as the increased consumption continues we'll have a relatively short supply," Xin said. "[But] it's going to take some time for the industry to come back from the revenue they've lost over the last year or so."
Price wars between competing retailers kept egg prices at summer lows through Thanksgiving .
In Springdale, Wal-Mart was selling Great Value large eggs at 88 cents per dozen on Wednesday while the Aldi location across the street priced its large eggs at $1.45.
In Rogers, about 11 miles north, prices were even lower.
The Aldi in Rogers had the same large eggs sold in Springdale priced at $1.09, while the Wal-Mart that's less than a mile away had the same Great Value eggs at 55 cents per dozen.
Business on 11/30/2017