From Our Print Edition

It seems like everyone is talking about the price of eggs these days. The good news for retailers is that Americans have continued to buy eggs at a time when category experts openly worry that outbreaks of the highly pathogenic avian influenza (HPAI) may further constrain supplies and raise prices.

Dollar sales in the fresh egg category jumped 55.9% to $3.39 billion during the 12 weeks ended Dec. 1 (compared with the same period a year ago), while units rose 2.4%, according to Chicago-based market research firm Circana. Figures provided by the American Egg Board (AEB), Chicago, indicate a similar trend through the end of the year.

‘HPAI this year has disproportionately impacted cage-free farms.’

“Retail egg sales remain strong. For the four-week period ending Dec. 28, egg sales volume, measured in dozens of eggs sold, was up 2.7% versus the same four-week period a year ago. This marks the 22nd consecutive four-week period of year-on-year growth,” says Mike Hostetler, vp of consumer insights at AEB.

He adds that several specialty egg segments — cage-free, free-range, and pasture-raised —posted double-digit volume increases in December 2024 versus December 2023. However, conventional eggs were down 3% for the month as reduced supplies in some markets led to even higher prices.

ANOTHER GOOD YEAR EXPECTED

Hostetler expects egg sales to remain solid in 2025 but says the category may face some headwinds as the industry laps the strong numbers put up last year. He says that there may be some slowdown in January’s numbers if consumers prove more reluctant to pay “premium prices” for eggs than they were during the holidays.

Nellie’s Free Range Sous Vide Egg Bites have been reformulated with contemporary flavors like uncured Bacon & Gruyere.

Hostetler also cautions that “supply issues could constrain sales if availability is limited” due to HPAI outbreaks or some other cause. Limited supplies may reduce marketing, merchandising, and promotional support as brands and retailers wait for supply levels to be bolstered.

Emily Metz, president and CEO of AEB, says that 2024 was a difficult year, in many respects, for U.S. egg farmers as more than 40 million hens were lost to HPAI, including 25 million in October alone.

“The supply disruption may be more pronounced with retailers and in states that exclusively sell cage- free eggs due to impacts from HPAI on cage-free farms — particularly on the West Coast, which has been hard hit,” says Metz. “That’s because HPAI this year has disproportionately impacted cage-free farms. Though more than one-third of all U.S. egg-laying hens are cage-free, more than 50% of the egg-laying hens impacted by HPAI late last year were cage-free birds.” She adds that this has nothing to do with the cage-free production environment. “Bird flu does not discriminate by the type of housing or the size of the farm.”

Even with potential challenges ahead, Metz is optimistic about the prospects for fresh eggs going forward. “Eggs are more popular than ever,” she says. “Our research shows that despite the pricing increases we’ve experienced, roughly 65% of consumers still believe eggs are ‘an affordable, high-quality protein source.’”

‘Sixty-five percent of consumers still believe eggs are an affordable, high-quality protein source.’

Tom Flocco, CEO of Pete & Gerry’s, Monroe, N.H., is also optimistic about the egg category’s growth potential. “Grocery costs remain consistently 20% higher than they were in 2021, leading to many consumers finding cost-sensitive ways to feed their families. Eggs, ‘nature’s perfect protein,’ are one of these solutions. They’re healthy, affordable and cost roughly one-tenth of beef per gram of protein,” says Flocco. “They are also more sustainable and leave one of the smallest carbon footprints of any animal protein source.” He adds that ‘breakfast for dinner’ is an increasingly popular way for families to stretch their food dollars.

COMMODITY VS. PREMIUM EGGS

Flocco expects premium specialty egg sales to lead category growth as higher prices on conventional eggs and greater awareness about animal husbandry practices and environmental impact lead consumers to modify their purchasing decisions.

Consumers are increasingly open to trying new artisan-type items such as duck eggs.

“While total household penetration is not likely to grow much in the future — eggs are already in 96% of American refrigerators — the split between commodity and premium eggs will continue to shift in favor of premium. Commodity eggs are likely to continue to decline 4% to 5% per year in volume for the next several years and could level out at around 50% of the volume, down from 80% not too long ago,” he says.

Pete & Gerry’s CEO also expects consumers to trade up from the conventional segment as more states join Arizona, California, Colorado, Massachusetts, Michigan, Nevada, Oregon and Washington in banning the sale of caged eggs.

“States will no longer sell caged eggs, shifting consumers to cage-free eggs or better. We’ve seen that this shake-up at the shelf encourages shoppers to be more conscious of egg choices and open to trying premium, humanely raised egg options,” he says.

Flocco cautions that implementation of the first phase of the U.S. Department of Agriculture’s Organic Livestock and Poultry Standards (OLPS), effective Jan. 1, may impact supplies of some organic eggs. He cites requirements for increased perch and feed space for hens as an example. “At a category level, this is a major step forward in the humane treatment of organic cage-free hens; however, the new standards could cause a shortage in the egg aisle.”

‘New [humane treatment] standards could cause a shortage in the egg aisle.’

Flocco says consumers are looking to brands and grocers for “more humanely produced egg products.” This includes items such as reformulated Sous Vide Eggs from Nellie’s Free Range. “This new, better-tasting recipe not only caters to consumers seeking convenient, on-the-go, protein-rich snack and meal solutions, but also delivers on more contemporary flavor profiles with our Bacon & Gruyere and Egg White with Roasted Red Pepper options. We are also preparing to expand our branded fresh egg product portfolio in 2025, grounded in how we’re seeing consumer preferences evolve in premium eggs.”

FOCUS ON CONSUMER NEEDS

George Weaver IV, a fourth-generation member of family-owned Westfield Egg Farm, based in New Holland, Pa., expects 2025 to be a strong year for the category and the company’s Nature’s Yoke and Utopihen brands.

“The category is continuing to evolve and change, and our plan going into 2025 is to continue to support the requests of our customers,” reports Weaver, who says West- field introduced soy-and corn-free eggs (from hens fed a diet free from both grains) in 2023 in direct response to consumer requests.

Weaver says that new egg innovations will likely be introduced in the first half of 2025, but the company is holding off on formal announcements until it has the capacity to meet what it expects will be high supply demand from retail partners and end consumers.

The key to success in the rapidly changing egg market comes down to being responsive to customers’ needs, according to Weaver.

“Focus on getting the [egg] consumer what they actually need. [Grocers] have a built-in relationship with customers who walk through their doors. Continue to talk to them and build genuine relationships that create trust,” he says.

Weaver points to the small but growing market for duck eggs as one example of being responsive to consumer and retail partner needs. His company recently began a regional rollout of duck eggs in select Costco warehouses. The chain’s members are open to trying more artisan-type products and are attracted to small brands that offer these types of items, says Weaver.

Duck eggs are becoming a meal alternative for people who are allergic or sensitive to chicken eggs. Ducks also lay eggs on different cycles than chickens, so inventory of one can even out the other during times of reduced supplies.