U.S. consumers could finally see more eggs back at grocery stores at lower prices in the coming weeks, following a drop both in demand and in bird flu cases, according to Morgan Stanley Research.
After prices rose to record highs of more than $8 per dozen in February, consumers responded by cutting eggs from their shopping lists. With lower consumption, wholesale prices started declining, which signals a likely drop at retail stores in the coming weeks.
“Forecasting egg prices is still challenging because it depends on future bird flu cases,” says Morgan Stanley Economist Diego Anzoategui. “But we expect them to start falling in May at retail stores, after demand from the Easter holiday eases, and we may see eggs close to $4 per dozen by the end of the year.”
Another piece of good news for consumers is that eggs are returning to grocers’ shelves ahead of the April 20 holiday. The U.S. Department of Agriculture (USDA) said in a March 28 report1 that the supply situation at grocery stores has “greatly improved” in recent weeks and “consumers are once again seeing fully-stocked shelves and enjoying a range of choices without purchase restrictions.”
Bird Flu Still a Risk
Bird flu, or Avian Influenza, is a viral infection that spreads mostly among birds, but can also affect other animals and humans. Poultry producers need to euthanize affected flocks to contain the spread of the disease, resulting in a reduction the supply of chicken and eggs.
Egg prices have been higher because of a second outbreak of bird flu that began in the third quarter of 2023. Cases increased throughout 2024 and reached a peak this past January, with 23 million confirmed bird infections that month.
Even though bird flu cases dropped in March, a key risk ahead is another outbreak that could worsen the situation at poultry farms.
“It’s hard to predict how the bird flu cases will evolve,” Anzoategui says. “We can’t rule out the possibility of future spikes this year. In fact, as the USDA points out, wild bird migration during the spring and fall can further spread the virus.”
Eggs to Help Lower Inflation
After egg prices skyrocketed in February, the USDA announced a $1 billion plan to reduce the impact of the shortage in the near and long terms. The plan included spending on boosting imports, bio-safety precautions at egg farms and replacement of culled birds.
The efforts to buy eggs from other countries were likely insufficient to prevent prices from rising as current import levels account for less than 1% of domestic egg consumption, according to Morgan Stanley Research.
Food inflation started accelerating in mid-2024, initially boosted by fruits, vegetables, beverages and eggs. However, egg prices gradually became the main upward pressure, accounting for the food inflation from December through February.
“Now, the drop in egg prices will likely reduce food-at-home inflation quickly, barring tariffs on food products or further acceleration in food commodity prices,” Anzoategui says.
Morgan Stanley Research estimates food at home inflation will slow to an average of 0.12% starting in April, after reaching almost 0.5% in January. The annual rate could be below 2% by the end of the year, but the recently announced reciprocal tariffs add upside risk to food inflation ahead, Anzoategui says.
For deeper insights and analysis, ask your Morgan Stanley Representative or Financial Advisor for the full report, “US food inflation: Our eggs-pectations,” (March 31, 2025).
