Saturday, January 12, 2008

Strong Demand Driving Higher Egg Prices

2007 2008 egg prices yolk chicken high cost oil food fuelWith egg prices around $1.50 a dozen in the Midwest and almost double from a year ago, many media stories--aided by foes of ethanol--have "laid" the blame at the feet of higher corn prices. But the stories are all cracked up.

The Salina Journal gets the story right in a recent article. The article includes comments from a poultry specialist with the Kansas State University Research and Extension, Scott Beyer regarding the cost of eggs at the grocery store.
"Most people assume that higher grain prices are boosting egg prices, but most of the increase is due to supply and demand," Beyer said. "Right now supplies are down, demand is up."
Beyer explained that egg supplies are down for a number of reasons including guidelines to increase cage space, which means fewer hens can be housed in their facilities and other animal welfare regulations. The story also mentioned that the strong dollar has also made exports strong. Finally, a backlog of stored processed dried eggs was reduced and summer heat and drought in the southeastern United States reduced egg production and egg sizes.
Consumer demand has been strong, Beyer added, citing per capita consumption that has continued a steady increase after decades of decline.
The mainstream media has had its facts scrambled this year reporting myths rather than the truth concerning the true source of higher food costs.

Higher food prices are not a yolk to consumers, but the least the media can do is to the facts correct without laying a giant goose egg.


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1 comment:

Skip_Wilson said...

It's interesting that the wholesale price of eggs have fallen over 40 cents since Easter but no comments in the news about this.