Supermarket egg prices continue to rise

Published on : 21 Mar 2023

A number of major retailers have increased their prices over the last month, particularly on large free range eggs

Prices have continued to climb on supermarket shelves over recent months as retailers adjust to the ongoing shortage of egg.

A number of major retailers have increased their prices over the last month, particularly on large free range eggs. Asda raised the cost of 12 large free range eggs by 33 pence last month to £2.80, whilst Lidl and Morrisons also increased the price of the same eggs by 10 and 24 pence respectively.

These price rises are a continuation of the significant hike that all retailers have delivered in the previous months.

The cost of a dozen large free range eggs in both Sainsbury’s and Aldi has risen by 50 pence in the last year, whilst Tesco have raised the cost of 6 large free range eggs by 35 pence in the last year.

In late 2022 retailers were hit hard by the shortage of egg after producers cut back on production or left the industry altogether due to the soaring costs of production. Some supermarkets are still seeing those shortages as a result.

The total UK laying flock dropped from nearly 39 million birds to just under 36 million between September last year and February 2023. The strain of the shortage led some retailers to import egg from abroad, including Sainsbury’s who sparked a strong backlash when they began selling Italian eggs in November. There was also a rise in the amount of caged and barn production during the first two months of this year as the retailers worked to plug the shortfall on their shelves.

The data is now starting show signs of production increasing, with the free range flock growing by 250,000 birds since January, however despite this upturn there is naturally a lag between the decision of producers to return to production and the availability of egg.

BFREPA CEO Robert Gooch welcomed the higher prices but explained that these are the increases BREPA asked retailers for almost a year ago.

He said: “Egg prices have been one of the biggest risers on retail shelves and this has started feeding down through to producer prices. Producer prices are now 40p/dozen higher than a year ago (April 2022 vs March 2023), which is the price rise that BFREPA asked retailers for during its ‘Breaking Point campaign’ last April. Calls for price rises during the campaign were ignored by retailers at the time, but producer prices did start creeping upwards in the autumn, with larger rises feeding through during the first few months of this year.

“However, those price rises were too little, too late. As a result, there have been shortages on retail shelves since November which could have been avoided if retailers had heeded our warnings at the ‘Breaking Point Summit’ at the Pig and Poultry Show last May. We warned that there would be shortages in the run up to Christmas due to producers not restocking or giving up production due to poor prices, but retailers ignored our cautions. Industry data showed that the number of free range hens housed dropped every month from July to the end of the year, but it now looks as if the decline has bottomed out and hen numbers are starting to increase again”, Mr Gooch continued.

“BFREPA has toured the country undertaking a series of roadshows in England, Wales and Scotland over the last month and talked to many producers about the future. While the price increases have been welcomed by many producers, some are still concerned about returning to production due to fears about the longevity of the higher price levels. Many felt they have been badly ‘burned’ in the past with promises of good prices which have been cut during the life of variable price contracts. BFREPA has been campaigning for more feed trackers or cost plus contracts which would give producers more confidence about future prices reflecting cost increases, and we are pleased to see that more of these contracts are now becoming available to producers”.

A spokesperson from the BEIC told the Ranger that in order to ensure the egg supply chain can be sustainable in the longer term, each part needs to be profitable to enable future investment to take place.

They explained: “At the root of a sustainable egg industry is a supply chain that benefits everyone involved, and that is something we believe is achievable. The British industry is proud to produce eggs to the world-leading standards of the Lion scheme, and British consumers want to keep enjoying Lion eggs. In order to achieve that, we need a robust sector with all stakeholders focused on delivering a sustainable future.

They added: “Eggs have always offered incredible value for money as they are one of the most nutritious, sustainable, and affordable whole foods on the shopping list, and play a crucial role in everyday meals for all the family. It is our absolute priority to ensure that there are enough British eggs for all to enjoy and to ensure that British farmers are in a position to provide the eggs that consumers want and expect year-round”.

Waitrose, who have increased the price of 6 large free range eggs by 82 pence over the last year explained that they attempt to balance the price they are paying for their eggs with the volatile costs producers face.

A Waitrose spokesperson said: “We've worked with our egg supplier for over 40 years and, to make sure we pay fairly, the price we pay for eggs has long been linked to the price of feed. We also review other inputs to cost such as energy and labour, and pay accordingly”.

Andrew Opie, Director of Food and Sustainability at the British Retail Consortium, explained that the rising costs facing producers have led to the rising costs on supermarket shelves.

He said: “Rising inflation is a significant concern for both consumers and retailers. There are a number of pressures facing the egg industry including Avian Flu, and the rising cost of energy and animal feed, which has been exacerbated by the war in Ukraine. But, despite these challenges, retailers are working with suppliers to manage prices to ensure affordability for all consumers”.

Last month John Kirkpatrick, Tesco’s Agricultural Manager for Poultry and Eggs, told the Ranger that they are committed to supporting British egg producers. He noted the importance of the feed tracker that Tesco offer producers as well as the five year contracts that they began offering in October last year.

He said: “Quality, value, innovation, and service level continue to be important within a very challenged market. We aim to do the right thing, what is right for our customers, farmers and wider supply chain”.

“Our support for the industry is demonstrated by having invested £27.5 million in the sector from March 2022 to March 2023. The support package includes £13.6m of support already provided to Tesco suppliers and producers since March 2022, as well as a commitment to provide a further £13.9m of additional support until March 2023, with the support continuing after that date. It will be paid to suppliers to cover the cost of handling, processing, and egg production, including any increases in feed for farmers. Tesco will continue to work with its suppliers to ensure the additional investment gets passed to farmers as quickly as possible”.