Egg prices have been dominating the news as consumers lament $10 price tags and purchase restrictions—but how are the farmers who produce the eggs under contract with the largest corporations getting along?
Not well. As we suspected, the largest egg corporations’ increased profits are not making their way to the farmers doing all the work—in fact, they’ve received a raise of just a penny per dozen in more than a decade.
While avian flu has been cited as the primary driver of skyrocketing egg prices since 2022, our research found its actual impact on overall production has been minimal. Instead, dominant egg corporations—particularly Cal-Maine Foods—have leveraged the crisis to raise prices, amass egregious profits, and consolidate market power. Cal-Maine has made more money in a single quarter during the avian flu than they used to make in an entire year. It’s alarming enough that the Department of Justice is launching a probe into egg pricing on the heels of Farm Action’s investigation and letter to federal enforcers about this scheme.
But where is all of this money going? We’ve long suspected that it’s not finding its way back into farmers’ pockets, but now we can confirm it thanks to newly obtained documentation from one of Cal-Maine’s contract farming families.
Cal-Maine Gave Contract Farmers Just Over a Penny Per Dozen Raise in More Than a Decade
After reading about our work to shed light on the potential egg pricing schemes of dominant firms like Cal-Maine, a farming family who has contracted for Cal-Maine for many years reached out to share their story.
While Cal-Maine has raked in profits off the backs of consumers, these farmers have received a mere $0.0125 per dozen raise around six years ago—that’s right, just over a penny more per dozen. They are currently paid $0.2675 per dozen total. “We are getting 26.5 cents a dozen, and we are on duty 24 hours a day, seven days a week, 365 days a year,” they explained.
To put that into perspective, just $0.26 of the $10 you spend on eggs at the grocery store goes to the family farmers producing the eggs. Meanwhile, Cal-Maine reported $356 million in gross profits during its most recent quarter.
The farmers added that they are making less net income now than they did when they first began their operation when increased input costs are factored in. They estimate that it would take at least a 6.5 cent per dozen increase in pay to provide them the same income as they received when they started.
Cal-Maine’s Contracts Put Farmers Between a Rock and a Hard Place
Cal-Maine produces 90% of its eggs in its own massive industrial facilities, and just 10% of the supply is fulfilled by family farms through contracted work. After examining the contract of the Cal-Maine farming family who came to us, it is clear that there is no room for negotiating with Cal-Maine. Their contract farmers are forced to either accept the contract terms or go elsewhere—but Cal-Maine’s control over the egg market means there are few, if any, alternatives for farmers to work with.
To make matters worse, rather than using its profits to increase farmers’ pay, Cal-Maine has been using its influx of cash to buy out other smaller competitors, further increasing its control of the sector and eliminating choices for farmers.
In addition to pitiful pay, Cal-Maine requires its farmers to comply with unreasonable demands like paying for costly facility upgrades, and if they don’t comply, Cal-Maine can refuse to renew their contracts. The contracts have been deemed “generic” and “all one-sided.” It’s so bad that Cal-Maine egg farmers are revisiting their options—possibly moving towards raising other types of poultry.
The Blame Lies on Egg Corporations—Not Their Contract Farmers
People may assume that family farmers producing eggs are raking in money from high egg prices. But in the words of one of Cal-Maine’s own contract farmers: “You’re getting screwed, and guess what—so’s the farmer.”
Meanwhile, checkoff-funded industry groups like the government’s American Egg Board are making statements that use farmers’ financial struggles to deflect criticism of the pricing practices of the largest egg corporations: “I think to suggest anything else is a misreading of the facts and the reality,” American Egg Board President Emily Metz said. “Our farmers are in the fight of their lives, period, full stop … This is a supply challenge due to bird flu. Nothing else.”
However, farmers on the front lines of the avian flu are really in the fight of their lives because companies like Cal-Maine aren’t giving them even a slice of their egregious profits.
The farmers contracting with Cal-Maine also spoke about avian flu’s impact on operations, confirming that there should only be a six-month turnaround for farms that had avian flu to start producing eggs again. Moreso, the farmers noted that it’s Cal-Maine’s and other companies’ own industrial egg production facilities that have had avian flu outbreaks due to their larger size, foot traffic, and rodents, whereas the smaller contracted production operations are less vulnerable to these outbreaks. If a contract farmer’s flock gets avian flu, the impact is much smaller, from an estimated number of 10,000 to 75,000 birds on average. Corporate facilities hold astronomically more birds than this. If these commercial facilities were not the norm in our food system, the avian flu outbreak impact would likely be far smaller.
It’s worth noting that the USDA has continued to respond to avian flu by providing dominant egg firms with large payments to offset losses. The Biden administration paid $1.4 billion to the egg industry to offset losses, while the Trump administration has pledged another $1 billion. This financial relief is geared primarily to the largest egg firms that typically implement crowded, caged production systems that are most vulnerable to outbreaks. Notably, just two days after meeting with Cal-Maine, Agriculture Secretary Brooke Rollins announced her plan to continue bailing out impacted producers like Cal-Maine who have generated excessive profits during this time.
As the Cal-Maine contract farmers said, “Avian flu is not the cause of this problem; it’s corporate greed.”
Written and edited by: Jessica Cusworth, Angela Huffman, Joe Maxwell, and Emma Nicolas. Concept developed by Angela Huffman and Joe Maxwell
