Agricultural economist Nan-Dirk Mulder issued the Rabobank Global Egg Review on April 5th.
He noted the close correspondence between the Rabobank Global Egg Price Index and the Food and Agricultural Organization Food Price Index from 2007 through 2020. The recent divergence in egg price and the Food Index is attributed to the reduction in supply due to avian influenza. There are large differences among world markets with respect to egg price. In the U.S., the E.U. and Japan prices at both the wholesale and the retail levels remain high mainly attributed to avian influenza. In contrast China and India have experienced only moderate increases.
In looking forward, Mulder noteed the effect of escalation in feed cost, in part attributed to the invasion of Ukraine by the Russian Federation. Although the price of feed does not directly influence either wholesale or retail prices, there is an indirect effect if producers cease production, due to suboptimal-profitability or losses with depletion of working capital. This results in an imbalance between supply and demand reflected in an increase in price.
Rabobank consider that prices will moderate in nations that either do not have ongoing outbreaks of avian influenza or manage to control losses by intensifying biosecurity or applying vaccination.
Factors other than avian influenza have affected supply in some nations. Germany lost twenty percent of the national flock due to the restrictions on culling of cockerel chicks at the commercial level. New Zealand experienced a ten percent reduction in the producing flock following legislation mandating a transition from conventional cages.
Mulder correctly points to uncertainty in the production sector based on concern over avian influenza, higher interest rates, inflation in energy, labor and packaging that all erode margins. This has resulted in producers in many nations showing reluctance to restock farms, thereby contributing to future shortages.