Egg Prices Could Continue Dropping In US Because Of These Reasons

The prices of eggs in the U.S. could continue to fall due to several factors, the largest U.S. supplier said in a statement Monday.

Eggs prices, which have seen a dip since earlier this year, could continue that trend as the chick hatch rate has grown roughly 10 percent, Cal-Maine Foods Inc. said in its fourth-quarter earnings report.

The Jacksonville, Mississippi-based company also attributed the reduced prices to more massive flocks of hens and excess supply.

"Potential excess shell egg supply could create additional pricing pressure," Chief Executive Officer Dolph Baker said in a press release.

He added that specialty eggs accounted for 25.5 percent of company sales volume for the fourth quarter, relative to 22.7 percent sales around this time last year.

Cal-Maine Foods Inc. (CALM), reported a profit of $71.8 million in its fourth-quarter as its net average selling price of eggs increased 75 percent while its sales volume fell. Shares of the company fell 1.9 percent to $45.08 during Monday’s premarket trading.

Baker said that the Easter holiday and grocery stores promoting shell eggs largely helped drive its sales for the fourth quarter.

"These favorable market conditions supported our business with a significant improvement in profitability compared with a year ago. Importantly, our financial performance allows us to resume our quarterly cash dividend payment to our shareholders," he added.

Market prices were strong during the first part of the quarter but saw a decrease after the Easter holiday. Table egg prices were also turbulent this year. They rose to $2.53 per dozen but have since fallen to $1.19, according to Bloomberg, citing data from the USDA for the price paid to producers.

Cal-Maine Foods, Inc. focuses on producing, grading, packing and selling fresh shell eggs and conventional, organic, cage-free and nutritionally enhanced eggs. It is currently the largest producer and distributor of fresh shell eggs in the U.S., selling many of its eggs in states located in midwestern and southwestern regions.