Weekly Newsletter – August 18, 2023 – Eggs Run Amok
The chicken is crossing the road, and she is doing so dazzlingly. Toting a Chanel bag, sporting a pair of vintage YSL sunnies, and dripping in Van Cleef bling, she is the picture of luxury, and people can’t decide if they love her, hate her, or want to be her. As with any celebrity worth mentioning, she has managed to earn the public's ire, and has found herself in the midst of a red-hot media scandal. In the eyes of frustrated grocery shoppers near and far, she has become the sole proprietor of one valuable, highly coveted asset: eggs.
Prices have increased dramatically for nearly everything over the past couple of years, but the percentage increase in the cost of eggs has surpassed every other item by a landslide. In 2021, the average cost of one dozen eggs at Canadian grocery stores was $3.62; eggs now retail for an average of $3.87. Wholesale prices, much to everyone’s dismay, are also expensive. So expensive, in fact, that small business owners have started requesting a full credit from wholesalers if even one or two eggs they receive are cracked. Luckily for Ms. Poulet, transportation and production costs, retail margins, and demand all influence egg pricing, so the facts work in her favour.
There is a combination of factors at play here. Some, like inflation, have a broader, more long-term impact on goods in general. Costs are rising for many elements of consumer egg production including chicken feed, fuel, packaging, labour, and transportation. As a blank canvas for flavour and sustenance, eggs are a hot commodity—the average Canadian eats about 242 eggs per year—and keeping the supply of these eggs open is dependent on the hens that lay them. Speaking of divas, it costs egg farmers a fortune to feed their hens a nutritious, balanced diet of barley, corn, oats, and other grains. This is due, in large part, to export shortages and subsequent price hikes resulting from the Russia-Ukraine conflict. Other factors specific to eggs and poultry, like the outbreak of a highly transmissible and fatal strain of the avian flu, are arguably the biggest culprits. Following the widespread outbreak—the largest recorded in U.S history, wiping out upwards of 50 million birds thus far—the supply of egg-laying chickens—and, by extension, eggs—dropped dramatically. People love their eggs, so of course, demand remained steady, creating a textbook case of shortage.
Time for the good news and the bad news. Bad news—egg prices aren’t returning to normal anytime soon, and they won't until inflation settles down. Good news—you can save money by adopting Ms. Poulet's diet instead; she looks incredible for her age.
