By Marsha Laux, content specialist, AgMRC, Iowa State University, firstname.lastname@example.org.
Updated April 2012 by Malinda Geisler, AgMRC, Iowa State University.
The egg industry is one that has changed over the years from many smaller producers to one that is highly centralized and more specialized. In the early years of American agriculture, many farmers had chickens and collected eggs for their own use or for sale to friends, neighbors and the local grocer. Today, fewer farmers raise layers, and those farmers often specialize in egg production, maintaining large flocks of layers.
Prior to World War II, most egg production came from farm flocks of less than 400 hens. By the early 1960s, improved technology and the development of sophisticated mechanical equipment were responsible for a shift from small farm flocks to larger commercial operations. In the major egg-producing states, flocks of 100,000 laying hens are common, and some flocks number more than 1 million. Each of the 338 million laying birds in the United States in 2011 produced an average of 271 eggs a year (NASS).
Demand is driven by consumer consumption. Per capita, or per person, consumption is a measure of total egg production divided by the total population.
The high point for per capita egg consumption was 402 eggs in 1945. Per capita consumption had been steadily declining due to lifestyle changes and to health concerns. Per capita consumption reached its lowest point in 1995 at 232 eggs per person.
Of the estimated 215.7 million cases of shell eggs produced in 2009:
- 124.6 million cases (57.8%) went to retail.
- 66.4 million cases (30.8%) were further processed (for foodservice, manufacturing, retail and export).
- 18.3 million cases (8.5%) went for foodservice use.
- 6.4 million cases (3%) were exported. (American Egg Board)
The growth in egg consumption over the past decade occurred primarily in egg products, rather than in shell eggs. The following table helps to illustrate the change in the way consumers are using eggs.
Eggs: In-shell, processed and total farm weight, number per capita per year.
In 1997 table eggs were $0.81 per dozen for cartoned grade A large eggs in the New York area; by 2002 eggs were down to $0.67 per dozen. However, egg prices began increasing in following years. According to the ERS (2011), table egg prices averaged just over $1.15 per dozen in 2011, up 9 cents from the previous year. Since egg production was projected to expand, table egg prices were projected to average $1.02 to $1.10 per dozen in 2012.
Drivers of Demand
Eggs have become attractive as a source of protein and as a versatile food source. While cholesterol intake has been a factor in the minds of health conscious consumers, the health benefits of eggs have been promoted by the industry. Research into functional or designer eggs has provided new demand for the omega 3 egg and for eggs with specific nutritional attributes. Attributes in demand for egg products are cage-free eggs, lower cholesterol eggs, omega 3 eggs and eggs higher in vitamin E. Popularity of the various protein diets, where carbohydrates are limited and protein sources are allowed, have also been contributors to egg demand.
Trade associations and industry groups have successfully campaigned to improve the image of the egg, nutritionally and economically. Nutritional studies and research has helped to combat the high-cholesterol image that struck a blow for the industry.
Most eggs produced in the United States are table eggs for human consumption. In 2011, the number of eggs sold as table eggs totaled 79 billion eggs. The remainder of production is for the hatching market. These eggs are hatched to provide replacement birds for the egg-laying flocks and to produce broiler chicks for grow-out operations.
Egg production totaled 91.9 billion eggs in 2011, up from the 91.1 billion eggs produced in 2010. The value of all egg production was $7.4 billion in 2011, up 13 percent from $6.5 billion in 2010. (NASS).
The top five egg-producing states are Iowa, Ohio, Pennsylvania, Indiana and California. These five states produce approximately 44 percent of all U.S. eggs. According to the National Ag Statistics Service, the number of eggs produced by these states in 2011 (in millions) was as follows:
|States||Eggs (in millions)|
Eggs are sold as commodities. The USDA provides marketing statistics for various segments of the egg market. One measure is the historical tracking of the number of eggs cracked or broken. That information is then broken down by whole, whites or yolks. Eggs are also measured by frozen and dried forms, as well as by shell.
The average number of egg-type laying hens in the United States during 2011 was 338 million. Eggs per layer averaged 271 in 2011 (NASS).
Egg production has changed to a more vertically integrated system over the last 45 years. The egg industry has exhibited the most dramatic change toward a more vertically integrated system, proportionately more than broiler and turkey production.
According to the American Egg Board, there are presently 56 egg-producing companies with 1 million plus layers and 12 companies with greater than 5 million layers. There are approximately 178 egg-producing companies with flocks of 75,000 hens or more. These companies represent about 95 percent of all layers in the United States. In 1987, there were around 2,500 operations.
Egg exports consist of eggs for consumption, eggs for hatching and egg products for prepared and baked foods. During 2011 exports of U.S. eggs and egg products were valued at $434 million. The top markets were (in order): Canada, Japan, Mexico and Hong Kong. Canada purchased eggs and egg products valued at $74 million. (FAS)
Canada and China are the top two suppliers of eggs and egg products imported into the United States. The total value of those imports was $41.8 million in 2011. (FAS)
The Food Safety Inspection Service (FSIS) is responsible for administering a mandatory inspection program for egg products under the authority of the Egg Products Inspection Act of 1970. The Act and its associated regulations require that all commercial egg-breaking and egg-processing plants operate under continuous USDA supervision.
Poultry litter and the associated disposal is also regulated by the Environmental Protection Agency. Groundwater protection issues are important considerations, as are odor and nuisance of poultry production facilities. State and local agencies are also involved with the enforcement of these regulations.
Emerging Developments and Issues to Follow
Despite several factors having a negative impact on the egg industry, increasing population and rising per capita consumption have enabled the industry to expand.
Because of increased attention on consumer health, on environmental concerns and in issues from the animal welfare groups, designer and specialty eggs are niches in the egg market worth examining. Organic eggs, range eggs, cage-free eggs and omega 3 eggs are some examples of niches that are of interest and have experienced growth in the marketplace.
Additionally, convenience is an important factor when consumers make food purchases. The trend for consumers to eat more prepared and processed foods and to eat more meals away from home offers continued growth for the use of eggs in processed and prepared food items.
American Egg Board
Chickens and Eggs Annual Summary, National Ag Statistics Service (NASS), USDA.
Food Availability (Per Capita) Data System, Economic Research Service (ERS), USDA.
Global Ag Trade System (GATS), Foreign Ag Service, USDA.
Livestock, Dairy, and Poultry Outlook, ERS, USDA.
Livestock, Dairy, and Poultry Outlook: Tables, ERS, USDA.
Poultry Production and Value, NASS, USDA.
Profile created September 2004 and updated April 2012.