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the federal reserve decided to cut interest rates by 50 basis points at its september interest rate meeting. this radical policy decision caused considerable controversy in the market, and many people worried that it would re-catalyze inflationary pressure.

coincidentally, devastating bird flu outbreaks occurred one after another in north america and europe, and tens of millions of laying hens were culled, directly leading to a global egg surge. rabobank analysts pointed out that the global average egg price is already 60% higher than in 2019.

the bank also noted that approximately 33 million commercial laying hens and pullets were culled in the united states between november 2023 and july this year. in 2022, bird flu has caused the country to cull 40 million laying hens.

in addition to supply-side constraints, karyn rispoli, editor-in-chief of eggs at expana, a commodity trading data provider, also pointed out that the demand for eggs in the united states is still growing further. eggs are seen as a more affordable protein than meat, prompting increased consumption.

rabobank highlighted that these factors combined have resulted in the price of eggs in the united states now being more than three times higher than five years ago. over the same period, egg prices in south africa doubled, while egg prices in russia, japan, brazil, europe and india only increased by 50%-90%.

both supply and demand are unfavorable at the same time

according to data from the u.s. bureau of labor statistics, the price of eggs has increased by 28.1% in the past 12 months, and the average price of a dozen eggs is currently 3.2 us dollars, approximately 22.5 yuan.

amy hagerman, associate professor of agricultural economics at oklahoma state university, said bird flu is a key factor driving up egg prices. the scale of egg-laying hen farms is usually very large, so if an epidemic occurs in one farm, one to two million laying hens may be lost.

emily metz, president of the american egg association, pointed out that inflationary pressure is also an accomplice to the rise in egg prices. fuel prices are rising, labor and packaging costs are also high, and market price fluctuations reflect a range of factors beyond the egg farmer's control.

this was also used by republican vice presidential candidate vance to attack the democratic party, accusing democratic presidential candidate harris of being ineffective in the economic field.

the rise in egg prices is still more like an isolated incident in the short term and is not representative of the general inflation situation in the united states. but the worry is that economic problems are often complex linkages, and as the egg industry warns, fuel costs, labor costs and packaging costs are also high, showing that inflation is difficult to eradicate.