DOJ investigating major egg producers amid soaring prices: Sources
The Justice Department is in the early stages of investigating the major egg producers over soaring egg prices, source familiar with the matter told ABC News.
Department investigators are looking into whether the major egg companies are sharing information about supply and pricing, possibly contributing to price increases, the sources said. Egg producers, including the industry's trade association, have said the soaring prices are due to the avian flu.
The investigation is being run out of the Antitrust Division of the Justice Department and won't necessarily lead to any legal action.
Last month, a group of Democratic lawmakers, including Sen. Elizabeth Warren, D-Mass., called on the administration to provide specifics on how it plans to lower food prices for families.
"To make food more affordable, you should look to the dominant food and grocery companies that have made record profits on the backs of working families who have had to pay higher prices," they wrote in the letter to President Donald Trump. "These companies often exploit crises like pandemics and avian flu outbreaks as an opportunity to raise prices beyond what is needed to cover rising costs."
Egg prices have doubled since January 2024 -- and have skyrocketed over the last year. Wholesale shoppers like small businesses were paying over $8 for a dozen eggs last week. The latest Department of Agriculture report released on Friday said the national average wholesale price of eggs had dropped significantly to $6.85 per dozen.
Emily Metz, the president and CEO of American Egg Board, which represents egg producers nationwide, said any suggestion that egg price increases are due to price gouging is a "misreading of facts and reality."
"Make no mistake. Egg farmers are price takers, not price makers, on the egg market, and that market is responding to the uncertainty and chaos bird flu is causing," she said. "Eggs are subject to the economic laws of supply and demand. The tight egg supply caused by avian influenza, coupled with 23 consecutive months of high sales volume, has created a perfect storm in egg markets."
Farm Action, a farm advocacy organization that has publicly called on officials to open an antitrust case, said in a statement on Friday citing sources at DOJ that the agency had started an investigation.
"We applaud the Department of Justice's action to address the skyrocketing price of eggs," it said. "Every American has felt the financial pain caused by the power of the monopolistic egg industry.
"While avian flu is real, it is no excuse for the price being charged at the grocery store for one of the country's staples," it added. "While Farm Action's analysis demonstrates likely antitrust abuses by the dominant egg-producing corporations, the DOJ has the legal authority to take the deep dive into the industry that is required to get to the bottom of this abuse, and they have the power to bring justice on behalf of the American people."
The egg industry has consolidated over the decades, with Cal-Maine Foods emerging as the largest U.S. egg producer and is one of the few publicly traded companies, having acquired other brands. It has reported rising profits from the rise in egg prices, and its stock has gained about 50% over the past 12 months. The next four largest egg producers are privately held, so their financial data are not public.
Cal-Maine Foods reported in a recent Securities and Exchange Commission filing that the company's gross profits are up 342% through the second quarter of fiscal 2025 versus the previous fiscal year.
During the last spike in bird flu from 2022 to 2023, the company also reported more than tripling its gross profit compared to the prior year. In the company's 2024 annual report, Cal-Maine Foods partially attributed its $3.1 billion in sales and $1.2 billion in profit to the "significantly higher average egg selling prices."
"The increases primarily resulted from significantly higher average egg selling prices, primarily due to the reduction in egg supply caused by HPAI and higher grain and other input costs, as some of our egg sales prices are based on formulas related to our costs of production," the company disclosed.
However, in 2023, Cal-Maine lost a jury trial and had to pay millions over a price-fixing scheme. Cal-Maine Foods could not be reached for comment.
Even as consumers begin to see the wholesale price of eggs decline, Karyn Rispoli, managing editor of Expana, a firm that surveys and tracks the price of eggs, told ABC News that grocery shoppers may not see that decline reflected in the retail price of eggs as companies and retailers try to recoup some of their losses from the bird flu.
"In the aftermath of [the 2022 outbreak], as the market corrected and came down substantially, retailers were then holding shelf prices higher to try and recapture some of the margin that they had previously forfeited," she said.
Warren wrote in a letter to Trump in January that "egg producers and grocery stores may leverage the current avian flu outbreak as an opportunity to further constrain supply or hike up egg prices to increase profits.
"The country's largest egg producer Cal-Maine reported a significant jump in gross profits between the first and second quarters of fiscal year 2025 while hiking the price of eggs," she added.
"Cal-Maine's CEO acknowledged that the company's higher-than-estimated net income for Q2 'reflect[s] higher market prices, which have continued to rise this fiscal year as supply levels of shell eggs have been restricted.' Translation: the egg company and its shareholders are making higher profits while Americans shell out more for grocery staples," Warren wrote.
-ABC News' Luke Barr, Peter Charalambous and Michael Pappano contributed to this report.
