Wholesale egg prices plummet off highs
Daily wholesale egg prices (New York, large, grade A) have finally come off their recent highs, declining by $2.12/dozen during January to an average $3.78/dozen, USDA’s February “Livestock, Dairy, and Poultry Outlook” reported. This was almost 25% lower than the prior month but still about 162% higher than last January.
USDA economists Grace Grossen and Adriana Valcu-Lisman said the drop in daily prices has continued in early February, supported by gains in shell egg inventories. While prices are expected to decline over the next couple of weeks, they will begin to once again trend upward in the weeks leading up to the Easter holiday.
“Seasonal adjustments in wholesale prices associated with the Easter holiday are likely to be observed in March, as the Easter holiday falls in early April this year and grocery stores place their orders a number of weeks ahead of the event,” the economists noted.
Adjusting for the current pace of decline in the daily wholesale egg prices, USDA raised its Q1 wholesale price forecast to $2.92/dozen. No changes were made to the subsequent quarters. Consequently, the 2023 average wholesale egg price forecast is $2.07/dozen, almost 27% than 2022.
Table-egg production forecast lowered
December table-egg production was estimated at 652.2 million dozen, 6.6% lower than December 2021. The average size of the table-egg flock for December was estimated at 307.8 million layers, down 5.8% from last year. Total 2022 table-egg production was estimated at almost 7.72 billion dozen eggs, 3.2% lower than 2021 table-egg production.
USDA estimated the January 1 table-egg layer flock size at 306.3 million layers, which was more than 3 million egg-layers lower than the December 1 estimate. Grossen and Valcu-Lisman said the difference likely reflects the 3.9 million layers lost to HPAI in December, as well as a higher-than-expected slaughter of light-spent hens. Further, the January 1 estimate of 81.70 eggs per 100 layers per day suggests a slowdown in layer productivity.
The January numbers suggest lower production expectations in the near-term, but Grossen and Valcu-Lisman said the upstream indicators, such as eggs in incubators (egg-type) and pullet replacements, indicate that producers continue their efforts toward rebuilding the layer flocks affected by HPAI.
“These upstream flock indicators reflect the production expectations starting in late spring as it takes three weeks for an egg to hatch and another 18-20 weeks until a pullet (future layer) becomes fully productive.”
Given weaker-than-expected near-term indicators for table-egg flock production, USDA’s forecast for Q1 2023 table-egg production was revised downward 20 million dozen to 1.90 billion dozen. However, no changes were made to the subsequent quarters.
USDA projects 2023 table-egg production at 8.10 billion dozen, a 4.9% percent increase from the estimated 2022 table-egg production of 7.72 billion dozen.
Meanwhile, egg imports have been significantly higher. USDA reported that December egg imports were estimated at 4.5 million dozen,178% higher than last year. Egg imports in 2022 totaled 25.9 million dozen, 42.8% up from last year. Given higher-than-expected December imports, USDA raised the total egg import forecast for 2023 by 5.5 million dozen to 26 million dozen shell-egg equivalent, almost unchanged from the 2022 estimate.
Krissa Welshans | Feb 20, 2023