LAS VEGAS — In 2021, when egg prices were comfortably below $2 per dozen, Nevada and several other states enacted laws requiring the sale of cage-free eggs, motivated by concerns for animal welfare. However, four years later, the average cost for a dozen eggs has soared to nearly $5 in the U.S., largely due to the ongoing impacts of bird flu. To alleviate the financial strain on residents, Nevada has implemented a new law allowing for a temporary suspension of cage-free egg requirements, signed by the governor on Thursday.
Despite this move, the issue is more complex than it appears, which is why other states with similar laws are hesitant to make changes. By relaxing these regulations, Nevada may increase its supply of eggs, but overall egg availability remains limited. The bird flu outbreak, which began in 2022, has resulted in the slaughter of approximately 159 million birds to control the disease, often affecting entire flocks if the virus is detected.
The anticipated drop in egg prices resulting from the revision of cage-free laws is uncertain. This is primarily because farmers who invested billions converting to cage-free systems find it challenging to revert to traditional farming methods. Even if cage-free mandates were fully rescinded, major buyers, such as McDonald’s and Sodexo, continue to prefer cage-free eggs, thus maintaining a steady demand.
Jada Thompson, an agricultural economist at the University of Arkansas, noted that allowing various types of eggs could slightly decrease costs in Nevada. However, this could worsen prices in other areas, given the limited supply.
While Nevada is keen to implement these changes, states like California, Massachusetts, and others have shown little interest in similar actions. Other states, including Arizona and Utah, have passed cage-free laws, but these won’t take effect for several years. Assemblymember Howard Watts III, who raised backyard chickens and initially championed the 2021 bill for humane treatment, expressed regret over the unforeseen consequences of the avian flu outbreak, which severely impacted supply chains without options for flexibility.
Governor Joe Lombardo’s approval for a 120-day pause on the cage-free requirement offers prospective relief. A spokesperson for the Nevada Department of Agriculture indicated it might take about a month before consumers notice changes in grocery pricing. Owner of Egg Works, Brad Burdsall, revealed he is now paying over twice what he did two years ago for egg supplies, resulting in a surcharge per egg at his restaurant. He remains optimistic that this new law will grant his business additional egg sources, potentially allowing him to eliminate the surcharge soon.
Recent spikes in egg prices are reminiscent of the last significant avian flu outbreak in 2015, with this month witnessing the steepest rise. For some consumers, prices are even more staggering, such as in California where a dozen eggs can reach $12.99. Some grocery stores in New York have resorted to selling eggs in smaller bundles to accommodate those unable to afford a full dozen.
Despite pressure to drop cage-free policies, it’s important to note that a minority of U.S. eggs come from cage-free systems, with only about 121 million of the 304 million egg-laying chickens raised in such environments. Many of these eggs are committed to long-term contracts with food chains and grocery stores, complicating the supply picture. The United Egg Producers estimate that to meet the demand for cage-free eggs, there would need to be at least 226 million such hens, indicating a tight supply with increasing consumer requests.
As the bird flu outbreak continues to affect egg production, particularly within cage-free farms that are inherently more vulnerable, there are significant delays in egg reproduction following culling. In California alone, over 3 million hens have been lost due to recent outbreaks, impacting the overall availability.
While states like California are firm in maintaining their cage-free laws (stemming from a voter-passed initiative), skepticism remains about changing regulations in many states. For instance, Michigan’s Republican state representative remarked that the prevailing notion attributing high egg prices to cage-free regulations is a misunderstanding. He clarified that most farms have already adapted and removing the requirement would not necessarily reduce costs.
In Colorado, a bill to rescind new cage-free requirements was promptly rejected, reflecting a lack of support for reversing recent legislation. Local farmer Jonathan Kuester highlighted the egg shortage as a result of bird flu’s toll on larger farms rather than the cage-free practices. He pointed out that the panic buying of eggs has exacerbated shortages, leading to supply constraints.
As the situation evolves, states remain cautious about altering their respective cage-free laws, mostly due to the broader implications on the egg supply chain and prices amid the ongoing challenges posed by bird flu.
