In full transparency, the following is a media release from Sen. Elizabeth Warren’s office. She was elected by voters in the Commonwealth of Massachusetts to serve the state in Washington DC in the US Senate. She is a Democrat. (stock photo)
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WASHINGTON DC – Today, February 16, United States Senator Elizabeth Warren (D-Mass.) and Rep. Katie Porter (D.-Calif.) sent letters to top egg-producing companies calling on them to provide answers about the elevated price of eggs and the extent to which egg producers may be using fears about avian flu and supply shocks as a cover to pad their own profits.
In the letters, the lawmakers note that in the midst of record-high egg prices, Cal-Maine, the largest egg producer in the US, announced a 65% increase in profits while reporting no cases of avian flu. They ask the companies to provide transparency about the rationale for increasing egg prices and the financial impact to the companies. The letters were sent to Rose Acre Farms, Cal-Maine Foods, Hillandale Farms, Versova Management and Daybreak Foods.
According to the Bureau of Labor Statistics, increases in retail egg prices have outpaced all other food categories, jumping 59.9% annually as of December 2022, with consumers in some states paying more than $7 per carton.
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The avian flu outbreak, which producers have largely blamed for the price hikes, impacted approximately 43 million egg-laying chickens.
However, advocates have noted that the outbreak has decreased the size of the total flock by no more than 6 percent in most months, and in October 2022, total table egg production was down no more than 4.2 percent.
At the same time that prices were skyrocketing, Cal-Maine Foods, which controls approximately 20% of the retail egg market, was reporting record profit margins and no positive avian flu cases on any of its farms. In December, Cal-Maine Foods reported gross profits increase of more than 600% over the same quarter in 2021, which the company claimed was “driven by record average conventional egg selling price.”
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“Although (many) top egg producers are private companies that have not publicly announced either their profits or disclosed the financial impact of the avian flu on their flocks, past anticompetitive practices in the egg industry raise concerns about price gouging on their part,” wrote the lawmakers.
Lawsuits against Rose Acre Farms and other dominant producers accused the companies of price-gouging, collusion, and “cartelistic conspiracies” to limit production and keep supply artificially limited. In August 2020, New York Attorney General Letitia James sued Hillandale Farms, the nation’s second largest egg producer, for illegally gouging “the prices of more than four million cartons of eggs,” Similarly, a wide-ranging lawsuit accused several of the largest egg producers of colluding to increase prices during the COVID-19 pandemic.
“American families working to put food on the table deserve to know whether the increased prices they are paying for eggs represent a legitimate response to reduced supply or out-of-control corporate greed,” continued the lawmakers.
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MetroWest Medical Center