Falling prices, higher costs squeeze egg producers

Egg prices surged earlier this year as tight supply struggled to keep pace with demand, new figures show.

Now, with availability improving and seasonal demand easing, prices are moving in the opposite direction – leaving producers facing a new balancing act.

Earlier in the year, on the back of supply shortages due to avian influenza, the industry was trying to keep pace with demand.

See also: Why more efficient egg production requires vaccination rethink

Defra figures show UK egg production for domestic consumption was 6% higher year-on-year in Q1, with strong prices of 154p/dozen, up 3.9% year-on-year.

February saw increases of 40-45p/dozen for colony eggs and 30-35p/dozen for free-range, as retailers tried to meet demand. As a result, they looked to imports, particularly from Ukraine.

Heading into summer, demand has reached its usual lull, with medium and large egg prices reportedly down by 47p/dozen, and free-range by 25p/dozen.

Although demand remains steady for free-range, it’s important to maintain a balance without tipping into oversupply.

According to the latest Defra figures, 272m dozen eggs were produced for human consumption in Q2 2026, up 3.4% on Q2 2025 and down 0.5% on Q1 2026.

The UK farmgate egg price in Q2 was 153p/dozen, a decrease of 0.3% on Q1, demonstrating that although farmgate prices have been relatively stable, wholesale prices have fallen.

UK commercial layer chick placings were down 6.1% in June 2026 compared to June 2025, to 3.5m chicks, indicating that producers may be responding to the market.

But underlying annual consumption remains robust, as British Lion Eggs estimates total UK consumption was 14.5bn eggs in 2025, a 5% increase year-on-year.

Margin squeeze

At the same time, producers could be feeling the impact of higher feed costs.

The uncertainty in the Strait of Hormuz, the Ukraine conflict and drought across Europe have all contributed to a £13/t jump in spot ration costs, including wheat and soya, according to Poultry Network.

With feed costs high and egg prices falling, coupled with the pressure from imports, analysts say the challenge will be finding a balance in supply.

If producers reduce flock numbers in response to tighter margins, the market may well swing back the other way.