New Equilibrium Price of Egg in the US
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Case Code: ECON081 Case Length: 12 Pages Period: 2017-2019 Pub Date: 2020 Teaching Note: Available |
Price: Rs.300 Organization : The US Egg Industry Industry : Poultry Countries : United States Themes: Micro Economics, Pricing |
Abstract Case Intro 1 Excerpts
Excerpts
Background
A study conducted by the United Egg Producers along with the US Poultry and Egg Association, National Chicken Council, and National Turkey Federation revealed that the US egg industry in 2016 was responsible for 81,515 jobs, US$4.99 billion in wages, US$22.77 billion in economic activity, and US$1.78 billion in government revenue. In 2018, the US produced around 9.1 billion dozen eggs. Iowa was the top egg-producing state in the country producing 1.36 billion dozen table-eggs, followed by Indiana, Ohio, Pennsylvania, Texas, and Georgia...
Price Fall
In 2018, egg prices were fixed amid a 2% increase in egg production. As a result of product expansion, supply of eggs outpaced demand and placed a downward pressure on egg prices in 2018, which continued into 2019. Egg prices in the US were 21% lower on an average from January 2018 to January 2019 (US$1.55 per dozen compared to US$1.76 per dozen), according to the Egg Industry Center...
Road Ahead
Though the fall in egg prices was a good signal for egg lovers and budget shoppers alike, it was a gloomy sign for the US agriculture industry, which had already had to grapple with a milk glut in 2016 and delayed planting due to wet weather in 2019 and felt the ripple effects of the US-China trade war in 2018. America’s trade dispute with China, Mexico, Canada, and other countries might affect its exporting of eggs, Ibarburu said. Analysts expected egg prices to continue to fall in the years to come if egg suppliers maintained their growth trend....
Exhibits
Exhibit I: US Per Capita Egg Consumption (from 2000 to 2019)
Exhibit II: Retail Price of eggs (Grade A, Large) in the US (1995 to 2019)
Exhibit III: 2018 Average Price by Egg Type in the US (US$ per Dozen of Eggs)
Exhibit IV: US Egg Laying Rate (From 1983 to 2018)
Exhibit V: Year-wise Egg Production in the US (2000 -2018)
Exhibit VI: Top 10 Pledged Companies in the US for Cage-free Egg Production
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