The once and future source of inexpensive protein is back in full swing as egg production increases. The average price eggs, as tracked by the Bureau of Labor Statistics, shows that eggs are cheap. So much so that large scale egg companies are facing some financial challenges.

Eggs are Cheaper than Recent Years

Two years ago, the United States faced a major shortage of eggs as the Avian Flu ravaged chicken populations across the country. An estimated 12% of the laying flocks either died or were culled to prevent further spread of the disease. This drove a tremendous spike in the price of eggs, from just under $2 before the outbreak to nearly $3 during the worst of it.

Flocks were quickly replenished and even enhanced with new, more productive hens. This means a surge in supply of eggs which leads to a lower price. As of June 2017, the average price of a dozen large eggs has fallen to about $1.33.

Cheap eggs make for good opportunities
Egg prices soared during the Avian Flu epidemic but have since dropped

The Down Side of Cheap Eggs

For consumers, this means a great opportunity to get eggs cheap. For restaurants, it often means a wider profit margin. But for companies whose business is raising chickens to lay eggs, these are worrying times.

There’s a further complication for egg producers beyond just the price of eggs. Consumers are also looking for egg alternatives more often and finding them in flax seed, tofu, or other vegan products. The decrease in demand and increase in supply means that egg prices stay low in the hopes of selling rather than wasting production.

Cal-Maine, the largest single egg production company in the United States, released their first report of an annual loss in ten years. Cheap eggs mean a low profit margin and shift in demand. Once trading at over $60 per share, theirĀ CALM stock is now back to under $40. The loss drove the stock price down even further, but it has since bounced back a bit.

Moral of the story – if you want to invest in eggs, either in the buying of the eggs or of the buying of a stock, now’s a good time.