KANSAS CITY — The recent upsurge in the number of cases of highly pathogenic avian influenza (HPAI) and the increasing number of hens euthanized has been concerning, but the impact on egg product prices remains muted compared with the impact of HPAI in 2022 when prices shot to record highs late in the year.

Since the initial 2023 HPAI dection in a commercial egg laying flock was reported Nov. 3, there have been 16 cases in five states with a total of 12.9 million laying hens euthanized as of Dec. 28. California reported the most facilities with HPAI at eight (3,214,400 hens), followed by Ohio with three (4,522,500 hens), Iowa (2,737,400 hens) and Kansas (1,500,000 hens) both with two and Minnesota with one (940,000 hens). The total of laying hens lost to HPAI equals about 4% of the total table or market type egg laying flock estimated at 322 million by the US Department of Agriculture as of Dec. 1. 

Somewhat troublesome has been detections in two commercia table egg pullet facilities, one in California with 151,000 birds and one in Ohio with 1,363,900 birds. The loss of more than 1.5 million pullets (about 1.2% of total pullets on hand as of Dec. 1) will delay the restocking of commercial egg laying facilities.

Just as there were significant differences between the 2022 HPAI outbreak and the 2015 widespread outbreak, there also are significant contrasts between the 2023 outbreak that started in November with that of the 2022 outbreak that started in February and ran the entire year. The number of laying hens lost in 2023 was much less than in 2022, and the timing of lost production with seasonal demand cycles was different.

Brian Moscogiuri, global trade strategist with Eggs Unlimited, said the 2023 outbreaks began late in the year when food manufacturers were seasonally winding down demand for dried egg products as is typical during the November-December holiday period. Sales of eggs and egg products to foodservice also were down, he said. Shell egg demand outpaces egg product demand during the Thanksgiving to Christmas holiday period, and retailers may have been less aggressive with promotions this year amid supply uncertainty. In contrast, there was an upsurge in HPAI outbreaks in the spring of 2022, affecting supplies used to make dried products by food manufacturers ahead of the higher-demand summer months, then another upsurge late in 2022 when retail demand peaks and laying flocks had not yet been fully repopulated that sent shell egg prices to record highs.   

Shell egg prices have been volatile during the 2023 outbreak period, moving higher overall, but prices for dried egg products have mostly been unchanged. Wholesale prices for Grade A large eggs nearly doubled between Nov. 3 and Dec. 1, tumbled 30% between Dec. 1 and Dec. 15, then jumped 36% between Dec. 15 and Dec. 29. The December 2023 high still was 35% below the December 2022 record high that approached $5.50 per dozen. Egg product prices were unchanged between Nov. 3 and Dec. 30, 2023, except for a bump up in liquid and frozen whole eggs in early November following shell eggs higher. In fact, most egg product prices are down from late October, reflecting a seasonal decline in demand. During the record-high shell egg price period of December 2022, egg product prices moved higher but did not reach highs set earlier in the year, again reflecting less winter demand for egg products. 

Moscogiuri expects the HPAI situation will continue to underpin egg and egg product prices in the months ahead, with perhaps a greater impact when shell egg demand typically increases around Easter and egg product demand builds as food manufacturers boost production of mayonnaise and salad dressings in the spring to meet increased summer demand. He said HPAI also could impact the timing of forced molt (when laying hens are taken out of production for a period to prolong their laying career), which typically begins in late January. Many producers delayed forced molt in January 2023 because of high egg prices and lower hen numbers after the 2022 HPAI outbreak.

There are about 8 billion table eggs produced each month in the United States, a number that has grown during 2023 as the industry recovered from HPAI losses in 2022. January 2023 table egg production was 7,757 million eggs, down 7% from January 2022. November table egg production (the most recent data available) was 8,022 million eggs, up 4.3% from the prior year. Table egg production declined throughout 2022 but increased throughout 2023, although the trends were not consistent month to month. 

The number of laying hens euthanized in December 2023 totaled about 7.8 million, more than double the number destroyed in December 2022. The increased supply of eggs compared with a year earlier was a factor that limited the impact of HPAI on prices late in 2023 compared with late 2022, especially considering the number of hens lost earlier in 2022 was considerably greater than in 2023.

HPAI has been detected in several countries around the world. It is commonly spread by migrating wild birds, although it also can be spread between facilities if proper sanitation measures aren’t in place. That was the case in 2015 with the first widespread outbreak of HPAI in the United States. Initially caught from wild birds, the disease in many cases was spread by people and trucks traveling between poultry operations. The industry was caught off guard. Since then, significant steps have been taken to reduce the spread of HPAI between facilities, although there is little to no protection from the impact of wild birds, and the disease could be spread by dust from fields that wild birds have flown over or rested on. The disease again ravaged the poultry industry in 2022 despite improved inter-facility safeguards taken by the poultry industry. 

Since the first outbreak on Feb. 8, 2022, through Dec. 30, 2023, nearly 80 million birds (all species) have been euthanized due to HPAI, which was detected in 1,059 flocks in 47 states, including 451 commercial flocks of all types, according to the USDA. In the past three months, there were 25 detections in commercial flocks in October (1.37 million birds), 56 in November (8.08 million birds, cumulative) and 45 in December (11.47 million birds, cumulative).