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Posted 1/12/23 6:22 PM CST

i have no idea of who sets the prices of eggs. The broadcast news wide eye lament millions of chickens succumb to bird flu and prices of eggs are up 60%. At the same time the business section of the paper says the large egg suppliers with a few million laying hens only lost 5 to 10 percent of their flocks and were prepared for it and began restocking flocks as soon as possible yet egg prices have jumped 150% to 200% at retailers.
There aren't many birds succumbing to avian flu. There are a lot of flocks killed because of a few "positive" PCR tests that the flock is infected. This is a test. Just like many other things in the last few years are a test.

Don't yield. Stay frosty. Know your enemy.
 

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I am guessing new year and new grain contracts for the next year. Grain prices never really went down during harvest time. So it is just up from here as fertilize prices were just getting crazy last fall I can only imagine what they are now.
 

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The singular reason that eggs are increasing in price far faster than virtually any other food product is because of a sustaining bout of the avian flu.

The avian flu has severely impacted egg yields nationwide. Farmers continue to lose tremendous amounts of their poultry flocks, and this is having a direct impact on the number of eggs they can ship out. According to the USDA, approximately 60 million birds have succumbed to the avian flu to date.

There simply is not enough supply to meet demand, thus driving egg prices to heights unseen.
BS. That many birds were killed to "prevent the spread" of avian flu... the vast majority of them WERE NOT SICK. Whole flocks wiped out because a bird in the next town over that tested positive for avian flu (and I gotta wonder how accurate those tests even are). There would be many more eggs on the shelves if it weren't for the wholesale destruction of flocks because of some hysterical poultry health alphabet agency official
 

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He means exactly what he said only he didn't say it well. It's the supply and demand market (the producers) that sets the prices, not the government. The USDA keeps track of the current market prices and sends a list every week to the producers to let them know what is happening. The USDA doesn't set the prices, it only shows them what the prices are in the market. Then it's up to the producers to set their prices accordingly, as the producers choose to do. It's the same system in all countries. Maybe this will explain it better for you:

Chapter 5 - Pricing and sales policy.

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Well not really because supply and demand fluctuate from location to location. So if the USDA is sending out "national average prices" to local producers they are influencing the pricing and, therefore, it is no longer a function of supply and demand. No agency can 'set a price' in a supply-demand dynamic.

There is no "national market", the attempt to consolidate prices into some kind of national average, and sending those prices out as a model for pricing is price manipulation. Producers dont "set" prices in a true free market economy, its a bargaining process between supply [ producers ] and demand [ consumers ]. And it varies from place to place, moment to moment. Any attempt to short circuit that process contradicts the whole point of supply and demand.
 

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There are some big egg companies out there. We have a lot of chicken houses here in my county. If there is a confirmed case of avian flu locally all back yard flocks have to be killed along with the thousands of birds in those big chicken houses. The houses here are for Peco fryers


rankCompanyNumber of hens (millions)
1Cal-Maine Foods46,78
2Rose Acre Farms27,59
3Hillandale Farms20
4Versova Holdings LLP19,95
5Daybreak Foods14,48
6Michael Foods11,91
7Center Fresh Group11,5
8MPS Egg Farms11,1
9Prairie Star Farms9,3
10Gemperle Family Farms8,6
11Opal Foods8,39
12Herbruck's Poultry Ranch8,3
13Weaver Brothers8
14Sauder's Eggs6,6
15Rembrandt Enterprises6,25
16Kreider Farms6,1
17Hickman's Egg Ranch6
18Mid-States Specialty Eggs6
19Hidden Villa Ranch5,5
20Sparboe Farms5,48
21Fremont Farms of Iowa5,3
22S&R Egg Farm4,78
23Wabash Valley Produce4,7
24ISE America4,56
25Sunrise Farms Inc.4,5
26Cooper Farms4,33
27Minnich Poultry3,94
28Ritewood/Oakdell Egg Farms3,68
29Konos Inc.3,4
30Creighton Brothers3,2
31Forsman Farms3,1
32Esbenshade Farms2,8
33Berne Hi-Way Hatchery Inc.2,4
34Sunrise AcresEgg Farms2,38
35Central Valley Eggs2,3
36Giroux's Poultry Farm2,3
37Pearl Valley Eggs2,23
38Kreher's Eggs2,2
39Hamilton Eggs LLC2
40Schipper Eggs LLC1,82
 

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Supply and demand controls prices. However, just a little surplus drives prices way down and a slight shortage drives prices way up. It is a far more delicate balance than you might think.
You are seeing it now with eggs. You saw it with gasoline, both ways. When Covid lowered the demand for fuel, prices dropped a lot. When Biden's mandates tightened supplies, just as the economy was coming out of Covid, prices skyrocketed.
A few years ago, new home construction outpaced demand and housing values dropped. With the current labor shortage, supply chain issues, there is a housing shortage in many areas, driving up home values.
The government gets a lot of flack for meddling in from crops, but generally it keeps food affordable.
These highs and lows are so important, most large consumers engage in forward contracting. The oil refineries buy futures contracts far in advance of their needs. Many farmers store their crops and buy futures contracts. That insures them a price above the cost of production, at the risk of missing out on a rise in prices. The huge dairies, "egg factories" and butcher hog producers, depend on futures contracts for feed, to avoid the ups and downs of the market. Everyone is covering their risks as best they can.
Long ago, slaughter facilities bought cattle and hogs at auction. A true supply and demand system. Now, they go to the feedlots and lay out how many they need, when they want them and how much they will pay. The feed lot signs a contract and has to control their costs to earn a profit. The feedlot cannot withstand the peaks and valleys of feeder calves at auction. So, they contract directly with the feeder calf guys. The guy running cow/calf operations must fall into line, too. So, the farmers trade the boom/bust price roller coaster for a smaller, but steady, profit. But once these contracts are set, these producers are not interested in auctions or individual on farm sales. A pig farmer cannot sell 10 feeder pigs to 10 different people, if he has a contract for his expected production 6 months into the future. Penalties for failure to fulfill your contract are often harsh.

Many of these futures contracts are published and investors often buy and sell contracts, hoping to buy low and sell high. If it looks like there will ba a shortage, investors will but contracts, planning to sell after the day price goes up. But investors that hold these contracts, increase the demand for the businesses that use the products held under contract. They are forced to pay more because of shrinking supply. The investor sells the contract at a profit, but never actually touched the commodity. If something happens that reduces demand or increases supply, even if just a little bit, investors lose out.

Perhaps, anyone wishing to watch the problems facing the egg producers, avian influenza, increased feed costs, increased transportation costs, increased labor costs, would have, 6 months ago, bought a few million eggs on contract for this date. Whoever sold that contract would be in a jam right now with reduced supply and no where to turn to buy eggs to fulfill the contract.
 

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Well not really because supply and demand fluctuate from location to location. So if the USDA is sending out "national average prices" to local producers they are influencing the pricing and, therefore, it is no longer a function of supply and demand. No agency can 'set a price' in a supply-demand dynamic.

There is no "national market", the attempt to consolidate prices into some kind of national average, and sending those prices out as a model for pricing is price manipulation. Producers dont "set" prices in a true free market economy, its a bargaining process between supply [ producers ] and demand [ consumers ]. And it varies from place to place, moment to moment. Any attempt to short circuit that process contradicts the whole point of supply and demand.
Farmers are the only ones that buy retail, sell wholesale and pay the freight both ways. If the auto industry would operate like farmers, letting the buyers set the prices, they would be bankrupt in a week.
 

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Farmers are the only ones that buy retail, sell wholesale and pay the freight both ways. If the auto industry would operate like farmers, letting the buyers set the prices, they would be bankrupt in a week.
But the auto companies have the same problem as any other producer… consumers set the price! If prices get too high, consumers don’t buy.
 

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But the auto companies have the same problem as any other producer… consumers set the price! If prices get too high, consumers don’t buy.
Sure we do. I have had many dealers refuse my price.
 

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That's okay.

My business model sucks, too, but I know that people who need eggs are getting them.
Yep. Chickens are my hobby and I would have them even if no one wanted the eggs. I am fortunate that there is still a feed mill operating near us where they still grind chicken feed into a powder. Chickens love it and there is very little waste because chickens can't flip it out on the floor like they do the processed pellets and crumbles they sell at the farm stores. The ground feed is also a bit cheaper. I paid $11.50 per 50 pound bag a couple weeks ago.
 

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There are some big egg companies out there. We have a lot of chicken houses here in my county. If there is a confirmed case of avian flu locally all back yard flocks have to be killed along with the thousands of birds in those big chicken houses. The houses here are for Peco fryers


rankCompanyNumber of hens (millions)
1Cal-Maine Foods46,78
2Rose Acre Farms27,59
3Hillandale Farms20
4Versova Holdings LLP19,95
5Daybreak Foods14,48
6Michael Foods11,91
7Center Fresh Group11,5
8MPS Egg Farms11,1
9Prairie Star Farms9,3
10Gemperle Family Farms8,6
11Opal Foods8,39
12Herbruck's Poultry Ranch8,3
13Weaver Brothers8
14Sauder's Eggs6,6
15Rembrandt Enterprises6,25
16Kreider Farms6,1
17Hickman's Egg Ranch6
18Mid-States Specialty Eggs6
19Hidden Villa Ranch5,5
20Sparboe Farms5,48
21Fremont Farms of Iowa5,3
22S&R Egg Farm4,78
23Wabash Valley Produce4,7
24ISE America4,56
25Sunrise Farms Inc.4,5
26Cooper Farms4,33
27Minnich Poultry3,94
28Ritewood/Oakdell Egg Farms3,68
29Konos Inc.3,4
30Creighton Brothers3,2
31Forsman Farms3,1
32Esbenshade Farms2,8
33Berne Hi-Way Hatchery Inc.2,4
34Sunrise AcresEgg Farms2,38
35Central Valley Eggs2,3
36Giroux's Poultry Farm2,3
37Pearl Valley Eggs2,23
38Kreher's Eggs2,2
39Hamilton Eggs LLC2
40Schipper Eggs LLC1,82
Lucky for me, mine aren't in the backyard. They are across the lane in a barn.;)
 

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I propose we set up some type of bureaucratic protection system. We can call it Overseeing Prices for Eggs Committee, or OPEC for short. That way they can work to ensure that egg prices are high enough all the time that we don't notice when there is a surplus. They can also use fancy graphs to tell us that when there is a shortage it is our fault, and tell us how lucky we are to have them because they are keeping the price for the eggs we can't fin in stores from being higher than they are.
 

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One thing I've learned, the best solution to any problem, real or imagined, is to beg for authoritarian oversight. (Look what it did for the health care industry). Imagine what OPEC could do, they could cap chicken's egg chutes, and we could pay for the upkeep of capped chickens, and if some calamity happened, they could uncap them and we wouldn't notice eggs that cost a dollar a piece because they could have us paying two dollars a piece already.
 

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I'm on lifetime homesteading project number 5, all in Indiana and Michigan.
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Discussion Starter · #37 ·
Well not really because supply and demand fluctuate from location to location. So if the USDA is sending out "national average prices" to local producers they are influencing the pricing and, therefore, it is no longer a function of supply and demand. No agency can 'set a price' in a supply-demand dynamic.

There is no "national market", the attempt to consolidate prices into some kind of national average, and sending those prices out as a model for pricing is price manipulation. Producers dont "set" prices in a true free market economy, its a bargaining process between supply [ producers ] and demand [ consumers ]. And it varies from place to place, moment to moment. Any attempt to short circuit that process contradicts the whole point of supply and demand.
All good points.
All fair points. In fairness, what I've been posting are the wholesale prices, so it's the price between the producer and the warehouse, not the consumer. The bargaining process is often a silent one at the grocery store when the consumer decides to pick up eggs at the price offered, or does not.
 

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I agree that its a supply and demand issue and is more local but is influenced by regional and national trends.

We are still working through eggs from late last fall when our old hens quit laying. Every one of them are good. But for this season just a few days ago the DW said: "This weather is gonna screw things up" - related to eggs. Yup. She is correct. The cold hit came and went, now very rainy/foggy and above freezing for a few weeks. Sure enough we have three goose eggs in their coop. That means the ducks will be laying shortly and next our new chickens. Winter is far from over for us. The geese aren't even making a nest. Just dropping the eggs in a corner.

But we are ready. We LOVE our cholesterol hits! If you believe the hype, one goose egg every few days is over the top++. We use one per omelet 😛 with GOOD cheese and bacon. I usually can't finish the meal.

Bubba, sisters and Mugsy LOVE egg season! Daily an egg on their food. The evidence is there over the years for us. Except for Bubba's recent skin thing. But we haven't been dropping eggs on their food in the non-laying season.
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Back to the OP: for us its been hard to control our production for what we use internally. During the season we have eggs like a Ruskie with Vodka or a bureaucrat with dollars. We can't sell as access is a problem. So we use them internally. First off, fresh unwashed (but cleaned) farm eggs do very well, protected. Cool them and you can have eggs 6 months later.

2nd and third, well, that's a forum thing if interested.

No, I don't want to know what Canadians do with their eggs. Throw them?
 
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