Tribeca Park Cafe would very much like customers to know that the higher prices are not its fault.

"Due to high increase in egg, dairy products, and coffee prices, unfortunately, we have been forced to accommodate those high costs," a sign taped to the glass around its deli counter reads.

To emphasize, or perhaps provide evidence for, the claim, the Manhattan deli's management has taken it upon itself to print out recent news stories about high egg prices. I know about this because one of those news stories is my own, headlined "Eggs may be expensive forever." In addition to two other articles, from CNN and The New York Times, Tribeca Park also has one last message for customers: "We remain committed to providing high-quality products and appreciate your understanding during this time."

It's an understandable explanation. Egg prices have exploded lately, due in large part to the bird flu, which has resulted in the loss of tens of millions of egg-laying chickens in recent months. (Once one chicken on a farm tests positive for avian influenza, all the other chickens at that location have to be culled, as in, killed.) The average nationwide cost of a dozen Grade A large eggs hit $4.15 in December, per the Bureau of Labor Statistics, up from $2.51 a year ago. The average wholesale price of Midwest large eggs is $7.93 a dozen, up from $3.33 this time last year, the global commodities tracker Expana found.

High egg prices are surely cutting into the margins of some businesses, especially smaller operations such as Tribeca Park Cafe, which has an egg-heavy product offering. But given all the price increases in the past five or so years — and the evidence that big companies were able to add extra price increases just because they could — it's hard not to wonder whether all the news about egg prices gives some businesses a little extra leeway in what they charge. People have seen the headlines about egg prices, they've noticed what's going on in the grocery store aisle, and the instability of the postpandemic economy gives businesses more room to push costs onto customers.

The result: an opportunity for some eggs-cuse-flation.

The egg-pocalypse has officially hit the zeitgeist: Grocery stores across the country are experiencing egg shortages and limiting how many cartons of eggs customers can buy. Google searches about egg prices have soared. Earlier this month, 100,000 eggs were stolen from an egg farmer in Pennsylvania. Egg-related conspiracy theories have been hatched, including that drones have something to do with the bird flu's spread.

"It's crazy," said Brian Moscogiuri, a global trade strategist at Eggs Unlimited, a California-based egg supplier, joking that the egg-mania had made him famous. The day we spoke, he'd been talking to reporters about the Pennsylvania egg heist and whether it would influence egg prices. "I'm like, 'What do you mean some eggs were stolen?' It's the same if TVs get stolen: Does it affect the supply of TVs?" he said.

No, $40,000 in missing eggs is not an excuse for your grocery store or bodega to raise prices. But the constraints on just how many eggs farmers can harvest are legitimately squeezing businesses.

We're in year three of this most recent bird flu outbreak, and there's no clear end in sight. Egg prices have bounced up and down during that time, and lately, they've been on the upswing. Some businesses have managed to somewhat shield customers from fluctuations. Raising prices can be an ordeal, and many grocery stores use eggs as a "loss leader," something they sell at a low cost to get people in the door.

"The food service industry typically reacts more slowly to fluctuations in wholesale pricing because adjusting menu prices is a complex process," Karyn Rispoli, a managing editor for eggs in the Americas at Expana, said. "Restaurants have likely tried to absorb these rising costs for as long as possible, but after nine consecutive weeks of sustained increases, it's reached a point where they can no longer do so without impacting their bottom line."

Last week, Waffle House announced it would be adding a $0.50 surcharge to each egg that customers order amid an "unprecedented rise in egg prices." Blake's Lotaburger, a fast-food chain based in New Mexico, is adding a $1 surcharge to its items that include eggs. Online, there's anecdotal chatter about egg surcharges at brunch and extra-$0.50 egg sandwiches. A coworker recently noticed the local farm-fresh eggs at a store near her went up from $5 to $6 a dozen, even though the farm is, presumably, operating the same way as it was before.

Rob Perez, a co-owner of DV8 Kitchen in Lexington, Kentucky, started adding a $0.25 surcharge per egg to dishes in January, and in February, he upped the charge to $0.50. His two locations go through nearly 5,000 eggs a week, and wholesale price increases have become impossible to swallow. "The prices don't go from high to low. They inch down, and they fly up," he said. Thus far, customers have been understanding, though he recently realized his staff hadn't been consistently ringing up the surcharge on orders. He thinks it's partly accidental, partly intentional. "You never want to tell anybody, especially if you're going to get a tip," he said.

Like most of the operators implementing a surcharge, Perez said it would go away once prices came back down. In the meantime, he thinks the news coverage around eggs is probably helping his case. "Waffle House is going to provide all the education that people need," he said.

There is, of course, one big reason that many restaurants and grocery stores can get away with these price hikes: People are still willing to buy the eggs.

Alex Jacquez, the chief of policy and advocacy at the Groundwork Collective, a progressive think tank, and a former economic advisor in the Biden administration, said that while he was at the White House, they found retailers generally tried to keep eggs cheap as long as possible, given their consumer salience. But many retailers are reaching their limit.

"It really seems like the dam has broken. Inflation has persisted," he said. "Consumers have said that they're willing to continue to buy eggs, no matter what price."

Because eggs are a product people buy often, people generally know their price, but what counts as "acceptable" has been shifting. While $8 for a dozen eggs might have seemed outlandish in 2019, for today's consumers, it's par for the course. Even if people aren't thrilled about shelling out that much money, they're accustomed to some level of sticker shock. And since there's also so much variation in pricing — by store, geography, and egg type — retailers may be able to confuse people on the exact degree of the increase.

Jada Thompson, an agricultural economist at the University of Arkansas, said that it's hard to tell which stores are selling at a discount and which stores are charging the actual price. It's also hard to decipher who's leading on hikes and who's following. "Bob's selling them for $4, and Fred's selling them for $5. Is Fred taking the price up, or was Bob taking a loss?"

Every operation along the supply chain is trying to mitigate its own volatility risks, which could lead to some extra padding.

Firms have taken advantage of moments of uncertainty and chaos in the recent past — namely, when inflation took off amid the pandemic and the Russia-Ukraine war — to add a little extra margin to their bottom line. Research by the University of Massachusetts Amherst economist Isabella Weber and others found that companies were able to raise prices beyond what was justified by actual price increases to boost their profits, a phenomenon some have called excuse-flation. The media narrative played into expectations and price setting, too. If customers have heard on the news that businesses are scrambling, they may see the sudden jump in their grocery bills as the result of legitimate issues, rather than profiteering.

"Consumers are primed to believe that things are crazy right now with prices, and they could go up, and they could go down. And they might not be as sensitive to it as they would be in a persistently low-inflation environment, giving companies the perfect opportunity to raise their prices," Jacquez said.

For companies, the chaos, in theory, provides a bit of cover to add to their coffers. Why add an extra $1 just to cover the increased cost of goods when customers are willing to stomach a $2 increase, giving you an extra $1 of pure profit? It looks good to investors, and with everything going on, are consumers really going to notice?

"Large businesses had a number of excuses to raise prices, and consumers just didn't seem to want to or care to push back," Samuel Rines, a macroeconomic strategist at WisdomTree, said. "So all of a sudden, companies that weren't supposed to have much pricing power suddenly found themselves with a tremendous amount."

Some of this is a story of market concentration — if you're Pepsi or Coca-Cola, you can increase your prices and assume your main competitor is probably going along with you. Even in more competitive markets, if everyone thinks the other guy is going to charge more, they will, too. In eggs, specifically, there has been some suggestion that market concentration is responsible for price increases — namely, that Cal-Maine Foods, which controls about one-fifth of the egg market, is to blame. The egg producer has benefited from soaring egg prices in the past, though economists say it's not clear Big Egg is really to blame here.

"I won't name names, but there were companies who were putting up really high profits, and everybody's like, 'Why are you putting up profits while everybody else is tanking?'" Thompson said. "It was only because they had eggs during a shortage, and so their farms were benefiting from higher prices."

Most of the businesses adding surcharges for eggs say that this will all be temporary — once wholesale prices come back down, they'll go ahead and pass that along to customers. But those surcharges may prove sticky.

"We saw a bunch of supply-chain-related surcharges coming out of the pandemic that stuck around for a while," Neale Mahoney, a Stanford University economist, said.

Mahoney, who served on the National Economic Council under then-President Joe Biden and, among more pressing items, was tasked with looking into the egg market, said that the increase in wholesale egg prices had created a "permission structure" for firms to raise their prices. And as prices increase, every link along the supply chain sees a chance to up its fee.

Beyond surcharges and price increases, businesses may find other ways to fudge the lines on eggs. Henry Kim, the cofounder and CEO of Swiftly, a retail-technology platform, has pitched that grocers should move eggs in their stores to the meat department because when positioned next to beef or chicken, they'd look cheap. (This could also solve some of the demand problem because if eggs aren't in the dairy department, consumers won't be able to find them as easily.)

Not to be mean to eggs, but they are not really The Most Important Thing Happening in the Economy, despite all the attention they're getting. They are, however, a signal that businesses might take advantage of broader economic turmoil to pass on other price hikes. Consider the example of tariffs, which President Donald Trump has threatened and removed and delayed to the point that it's impossible for even the closest observers to keep track. If the grocery store adds a little extra to the avocado price tag, or that new car seems a few thousand dollars more expensive than it should have been, are consumers going to dig in and decipher the extent to which tariffs are to blame versus opportunism on the part of the grocery store or dealer? Think of all the surcharges and price hikes in recent years that have been vaguely blamed on "supply chain problems" without much further explanation. The tariff chaos could generate an "upward impulse on prices," Mahoney said.

Eggs, in short, might be the canary in the coal mine for what's to come in terms of a new round of excuse-flation. I should probably make an egg pun here, but I am out of them.

There is no denying that we are in an unprecedented moment for America's eggs. This bird flu outbreak is scary. The egg industry is hurting. Restaurants, grocery stores, and other businesses that depend on eggs are reaching a breaking point.

Perez, from DV8 Kitchen, at one point pondered whether it might just be easier for everyone to take a vacation than to keep seeing his margins squeezed with all his egg-heavy items. He's open only for breakfast and lunch, and he doesn't serve liquor, which is often a moneymaker in the food service industry. Beyond the egg surcharge, he's trying to get some customers to try a different dish.

"We're trying to figure out how to switch people from egg dishes to other dishes to make them more special and get them to think, 'Hey, I want to go and have a ham and apple butter on a Southern biscuit instead of that egg sandwich,'" he said.

For now, consumers should be prepared to see their egg prices go up — in the grocery aisle, at the deli, at brunch. And given all the chatter about it, people probably won't be surprised, either. Call it the Waffle House effect.

Emily Stewart is a senior correspondent at Business Insider, writing about business and the economy.

• Waffle House is adding a 50-cent surcharge to each egg that its customers order.
• The chain opted for the per-egg fee instead of a broader increase in menu prices.
• Waffle House added the fee as avian influenza kills chickens and drives egg prices higher.

Waffle House is charging customers extra for each egg they order as avian influenza sends prices higher.

The chain said it started adding a 50-cent surcharge for each egg it sells from Monday. The charge is temporary, and the restaurant could adjust or eliminate it if prices change, Waffle House said.

Waffle House added the fee instead of raising costs across its menu as it copes with an "unprecedented rise in egg prices," the company said.

"The continuing egg shortage caused by HPAI (Bird Flu) has caused a dramatic increase" in costs, Waffle House said in a statement. "Consumers and restaurants are being forced to make difficult decisions."

"While we hope these price fluctuations will be short-lived, we cannot predict how long this shortage will last," Waffle House said.

Some customers posted about the surcharge on X, formerly known as Twitter:

Restaurants, grocery shoppers, and others are being hit with rising egg prices as avian flu continues to circulate in the US. The disease has spread among egg-laying chickens over the last few years, killing many birds and resulting in higher egg prices.

As of January 30, the cost of a dozen Midwest large eggs was $7.08, according to the US Department of Agriculture. That's up from $1.65 almost exactly three years ago, before the latest round of avian flu started spreading.

Kevin Roose, a technology columnist at the New York Times, posted on Sunday that he paid a $1.50 per-egg fee at another restaurant:

In recent years, consumers have dealt with higher prices for other grocery staples. Inflation was one of the major issues in the presidential election last fall.

But President Donald Trump's administration has said relief from high prices will not be immediate. Vice President JD Vance said last month that "it's going to take a little bit of time" for the cost of food to come down.

CNN earlier reported the new fee.

Do you work at Waffle House and have a story idea to share? Reach out to this reporter at [email protected]

I wish I had good news about eggs, but alas, I do not. Egg prices are soaring again as the bird flu sweeps the US for the third straight year, cutting into supply. On the other side of the equation, seasonal factors have pushed demand up (all that holiday baking and cold winter weather makes people into egg-heads), and consumers have been buying eggs more than normal for the past couple of years. Those conditions aren't changing anytime soon, especially on the supply side. If I'm searching for a silver lining here, I guess it's that once you scare yourself enough about the potential implications of the bird flu for humans, you're not so worried about the price of eggs. But for now we'll focus on egg prices and the bad news on that front: Supercheap eggs are not on the horizon.

If there's a single product that epitomizes what consumers hate about high prices nowadays, it's eggs. People buy them regularly and therefore know their exact cost. They're ingredients in a lot of foods. And if you're looking for a protein source, they're one of the healthier alternatives out there that won't break the bank. Except they're not so inexpensive anymore.

The cost of a dozen grade-A large eggs hit $4.15 in December, per the Bureau of Labor Statistics, up from $2.51 a year ago. The average price of eggs hasn't been below $3 since June, and it hasn't been below $2 since the start of 2022. Wholesale prices paid by entities such as restaurants, grocery stores, and schools are much steeper: According to the global commodities tracker Expana, wholesale Midwest large eggs are $7.27 a dozen; the five-year average is $2.10. There's a lot of variation depending on where you live and where you shop — eggs can be a loss leader, meaning grocery stores discount them to get people in the door, and big-box stores in particular price them quite low. Citing data from Circana, Expana said the average cost of large eggs among smaller retailers was $5.31 a dozen. They're probably cheaper at Walmart and Costco. If you're in a state with laws about cage-free eggs, you might see higher prices than you would in a state without them. No one knows when prices will come back down. This interminable bird flu might not be an aberration, and other factors, such as the push to move toward cage-free eggs, may keep prices up, too. The acute causes of this price spike — a drop in supply, a jump in demand — point to long-term structural issues that might stick around.

"We are all in uncharted territory," said Brian Moscogiuri, a global trade strategist at Eggs Unlimited, a California-based egg supplier. He added that the industry had lost 26 million birds since October, more than 7% of the total flock. "It seems as bad as it has ever been," he said, "and the producers don't really have a recourse."

In other words, there's not much relief in sight.

"It seems highly unlikely we'll see a $2 egg market anytime soon," said Karyn Rispoli, a managing editor for eggs in the Americas at Expana. "There's no way for sure to say this is going to go on in perpetuity, but in the near term there doesn't appear to be any resolution."

The bird flu — or, as it's formally called, highly pathogenic avian influenza — is not new. A bird-flu outbreak in the US in 2015 led to a spike in the prices of eggs. But that bout of illness lasted only a season; it showed up during a migration period, as wild birds moved across the US, so it hit in the spring and died out in the summer. The problem with the current iteration is that it's not going away. It's continuing to spread, in birds and elsewhere — in dairy cows, in cats, and in people.

"By any metric, you look at animal epizootics, basically animal-based-pandemics, this is the largest one we've ever had," said Maurice Pitesky, an associate professor at the UC Davis School of Veterinary Medicine who focuses on highly pathogenic avian influenza and disease modeling. "It's in the environment. We see it in dairy lagoons. We see it in human wastewater. So it's ubiquitous at this point."

Typically chickens pick up the bird flu from waterfowl — think ducks and geese. But now they're getting it from a lot of sources. Sick cows can get the chickens sick because of shared equipment. An infected turkey farm up the road can infect a chicken farm as the airborne pathogen spreads in strong winds. Because it's been dealing with the issue for so long, the poultry industry is better prepared for a bird-flu outbreak than, say, the dairy industry, but there's only so much egg farmers can do to prevent it.

"US egg farms have the most stringent and comprehensive biosecurity of any poultry farms on the planet," Emily Metz, the president and CEO of the American Egg Board, a nonprofit that promotes and markets eggs, said in an email. "Unfortunately, even the best biosecurity isn't foolproof."

Once one chicken tests positive for the bird flu, the entire flock has to be culled (as in killed). Some farms have been wiped out several times over the past few years, and so many places have been affected that repopulation — getting new chickens to get the farms up and running again — is increasingly difficult. Given the scale, there's not a clear playbook for turning things around.

"Not only are we worse off now than we were three years ago, but I have not heard from any state or federal agency what the 'plan' is other than they keep doing the same exact thing," Pitesky said.

After an outbreak, producers get indemnification from the government, meaning they're paid back for their losses so they don't go out of business. They quarantine and clean and disinfect. And then everyone waits to see if they're hit again.

"Those are all good things, but those are after-the-fact things," Pitesky said. "We don't have anything that's really been employed that tells people — almost like a red light, green light — here's where we're having outbreaks, here's where we think the virus is moving next."

There is no single answer for why this bout of bird flu is so bad. It's partly a development issue and partly a climate-change issue. Some of it is that this strain appears to be more infectious than others, and in many more species. States such as California have lost most of their natural wetlands, meaning waterfowl are using different habitats closer to farms than in the past, which is more conducive to disease transmission. Migration patterns are changing. This all means there's no single solution or way to be sure it won't just keep happening.

"The thing is there really isn't another silver bullet that can be implemented to potentially stop it," Moscogiuri said.

Meghan Davis, an associate professor at the Johns Hopkins Bloomberg School of Public Health who studies environmental epidemiology, said some changes were making animals more susceptible to the virus as well. They may be more stressed because of climate change and resource availability, which could exacerbate their vulnerability. And then there's just the way we farm — animals packed together in giant facilities stacked on top of one another.

As for solutions, better surveilling and tracking of where the virus is headed is an important start. "You can literally rank and triage where you need to harden and improve your husbandry and biosecurity by doing that," Pitesky said. "That's a very scalable solution."

A lot of these investments — in tracking, surveillance, improving biosecurity, implementing rodent control for pests that may carry the bird flu, hiring more workers, and more — cost money, though, and can be a tough sell for farmers who are already hurting and may not want to pony up. And if they do, well, that increased cost is going to show up in your egg prices.

Moscogiuri said he wasn't sure producers had much recourse besides hoping a vaccine is approved for mass use for poultry in the US, but even that's complicated. Which birds are we talking about? Egg-laying chickens? Turkeys? Others? What if they need boosters, or the virus mutates, or the animals still get the virus?

"Sometimes vaccines can actually mask things and make things worse down the road as opposed to identifying which animals are diseased, depopulating them, and preventing further disease transmission," Pitesky said.

There are also trade issues, particularly for chickens exported for consumption, which are called broilers. Some countries don't want to import vaccinated birds because they worry that vaccines make the virus harder to detect.

"We have a lot of trade agreements that can be impacted if a country can't differentiate infected from vaccinated animals," Davis said.

Beyond the fight against the bird flu, plenty of other factors are helping push prices to this uncomfortable level. A not-insignificant part is on the demand side, which might mean some relief is ahead. The holidays are always a big time for eggs because of all that holiday baking. Cold winter months can lead to higher demand, because when bad weather hits and people panic-buy, they grab eggs. And then comes Easter, which is also egg-heavy.

Demand usually cools off in the summer, which is good to know, but it may not be enough to help with prices. Metz, from the Egg Board, said the volume of eggs sold in stores had been up year over year for 22 consecutive months. American consumers seem to have been heavy on eggs for a while now. Even at higher prices, eggs are still a budget-friendly option for protein, especially in the recent inflationary environment. They're also viewed as nutritional, so if you're on a health kick (and not a vegan), you might be incorporating eggs into your diet more than you used to.

Metz emphasized that the industry had seen four years of "extraordinary circumstances," including the pandemic and accompanying supply-chain challenges, high inflation, and the bird flu. "While no one can predict the future, egg prices are anything but static," she said, adding that none of these factors was permanent.

There are some non-bird-flu supply factors that could make higher egg prices sticky, too. A push to require eggs sold in certain states to come from cage-free chickens is contributing to increased prices in those places. California and Massachusetts, for example, have had cage-free laws in place for a few years, and such rules just went live in Colorado and Michigan. To put it plainly, it's expensive to be nicer to chickens.

"Large eggs on the West Coast right now are $8.86, and that's because California and the Pacific Northwest mandates cage-free eggs on shelves," Rispoli said, adding that bird flu was exacerbating the issue. "Any state where cage-free supplies are mandated are going to face additional challenges just because of the amount of cage-free production that's been lost to the bird flu," she said.

If you're annoyed by the price of eggs, you're not alone — a lot of people are. Inflation and persistently high prices have made grocery shopping an ever more frustrating experience, and looking at the price tag on a carton of eggs is like a mini punch in the stomach every time. Eggs are a commodity, meaning the price is always going to bounce. But given the broader context, the overall trend might be upward to a not-so-eggcellent extent.

Emily Stewart is a senior correspondent at Business Insider, writing about business and the economy.

• Gov. Gavin Newsom of California declared a "proactive" state of emergency over the H5N1 bird flu.
• The virus has spread rapidly through US dairy cattle herds, with 16 states affected.
• The CDC reports low public risk with no human-to-human spread, but 61 human cases have been detected.

Gov. Gavin Newsom of California declared a state of emergency over the H5N1 avian influenza virus on Wednesday.

The bird flu has been spreading rapidly through US dairy cattle herds since March, with infections confirmed in 16 states. Its jump from birds to cows surprised many virologists and raised concerns about the possibility that it could mutate enough to sustain human-to-human transmission.

For now, the US Centers for Disease Control and Prevention has not detected humans spreading the virus to each other and says the risk to the public remains low.

Still, 61 human cases have been confirmed across the country, with 34 of them in California. Many of these cases have been linked to infected cows or birds.

Newsom's declaration, which his office called a "proactive action," followed the detection of new cattle infections on dairy farms in Southern California, according to the office's statement.

"This proclamation is a targeted action to ensure government agencies have the resources and flexibility they need to respond quickly to this outbreak," Newsom said in a statement.

The FDA has said that grocery-shelf beef and dairy continue to be safe to consume. However, the FDA and unaffiliated virus experts have advised against drinking raw milk, which is not pasteurized and can contain harmful microorganisms.

"While the risk to the public remains low, we will continue to take all necessary steps to prevent the spread of this virus," Newsom said.

Also on Wednesday, the CDC confirmed the first case of severe symptoms in a human H5N1 infection, in Louisiana.

Slowing bird flu's spread

The H5N1 virus was first detected in a California cow on August 30. Since then, the governor's office reported, the state has distributed millions of pieces of protective equipment to dairy-farm workers and run a public education campaign.

Infectious-disease experts have previously told BI that limiting the virus's spread through cows can help reduce the odds of sustained human transmission.

That's because the more the virus replicates itself, the more opportunities it has to mutate, and the more new mutations can take hold and spread to new animals. As H5N1 spreads in cattle, a mammal population that lives close to humans, it gets more chances to adapt to humans.

"There's such a vast amount of virus at the moment. And clearly it is changing, and it's doing new and unexpected things," Christopher Dye, an epidemiologist and senior research fellow at the University of Oxford, told BI in June.

In a paper in the medical journal BMJ, Dye and his colleague Wendy Barclay argued that the risk of a major human outbreak was "large, plausible, and imminent" — but not inevitable.

When that paper was published in early June, there had only been three confirmed human cases in the US.

"Influenza has always been a concern for decades and decades, and this particular form of influenza for at least two decades," Dye said. Bird flu, he added, has "risen to a level of concern, I think, which is greater than ever before."

Bird flu virus has been found in a batch of raw—unpasteurized—milk sold in California, prompting a recall issued at the state's request, health officials announced over the weekend.

No illnesses have yet been linked to the contaminated milk, made by Raw Farm, LLC of Fresno County. The contamination was found in testing by health officials in nearby Santa Clara County, who detected the virus in milk from a retail store. The state laboratory has confirmed the finding.

In a YouTube message from Raw Farm, a company representative called the contamination "not a big deal" and emphasized that the recall is only being done out of an abundance of caution.

Read full article

Comments