US egg prices are finally cooling in a welcome shift for consumers.

But now a new challenge is sending producers scrambling: they have too many eggs at a time when their input costs are rising.

As the market swings from last year's avian flu-driven shortage to a growing oversupply, producers say lower grocery store prices are masking the squeeze from cost inflation.

"A year ago, all anybody could talk about was how expensive eggs were because a lot of birds were unfortunately lost," said Thomas Flocco, chief executive officer of egg producer Pete & Gerry's.

"We now have an oversupply situation, which is why you're seeing in some cases a dozen eggs below a dollar," Flocco said.

Egg prices fell 44.7% year-over-year in March 2026, according to Bureau of Labor Statistics data, marking a sharp reversal from last year's spike during the bird flu outbreak. The downturn follows a period of flock rebuilding, which industry officials said left producers wary of renewed shortages.

The price collapse is creating new pressure on margins at a time when producers can least afford it. Costs for inputs like feed, which spiked in 2022 and 2023, have been elevated for years, and now fuel prices have also spiked due to the war in Iran.

"All of those cost pressures are finding their way into our cost structure," Flocco said. "About half of the cost of a dozen premium eggs is feed. Diesel is an immediate impact. We have to drive to get those eggs."

American Egg Board president and chief executive officer Emily Metz echoed those concerns, nothing that feed, fuel and labor costs "did not disappear" and continue to weigh on producers even as consumer demand returns and wholesale prices weaken.

The good news for producers is that demand is strong, according to Flocco, as shoppers increasingly prioritise protein in their diets.

More than four in 10 Americans said they are more focused on protein than they were five years ago, according to a new survey commissioned by Pete & Gerry's. It also found two-thirds of Americans said they eat eggs weekly specifically for their protein, and many view whole foods like eggs as more nutritious than processed alternatives.

Shoppers seeking eggs at the grocery store lately have found them plentiful and at good prices. But for producers, even that strong demand has not been enough to negate oversupply.

"What we're seeing in the market today is much more about supply recovery and timing shifts than any fundamental change in consumption," said Sherman Miller, CEO of Cal-Maine Foods, the largest egg distributor in the U.S., in April.

Metz also said the current price weakness is not demand related.

″(Prices) reflect supply growing faster than demand can absorb, driven by flock recovery following [avian influenza], small farm growth, and improved productivity," said Metz.

- CNBC

US egg producers face oversupply of eggs

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