On Saturday morning in Culver City, Calif., Marie Hernandes finally found her eggs. A friend had asked for a vanilla birthday cake, so all week after work, she’d visited multiple stores — Ralphs, Target, Walmart — only to find the eggs sold out. Finally, an early-morning run to Costco landed her two 24-packs at $7.69 each.
“I might as well get more,” she said. “I don’t want to spend more time without eggs.”
Grocery stores 20 minutes away had wildly different selections. In Inglewood at a Northgate González Market, a family-owned Mexican chain with 43 locations in Southern California, eggs priced at $7.99 had sold out by 11 a.m., leaving a dozen large eggs from a different farm for $11.19, with few takers.
At an Aldi nearby, Muriel Stubbs grabbed a dozen eggs for $7.99 for her family of five, the cheapest she could find, which still rendered them a luxury reserved for “whenever I get paid,” she said.
Avian influenza has left Americans to navigate a seemingly random array of shortages, available brands and price points as they hunt for eggs at various stores. The head-spinning increases in egg prices are driving renewed calls for scrutiny of consolidation in the egg industry. And for consumers, the crisis is exposing the complexities of how a once-ubiquitous staple arrives in stores.
A few aspects of the supply chain can help explain customers’ wildly inconsistent shopping experiences. During a shortage, grocers have limited options for keeping eggs in stock. They can buy eggs on the wholesale market, which commands high prices, and then decide how much of that cost to pass on to customers. Bigger retailers can use their larger matrix of contracted suppliers to do similar juggling. Or grocers can keep prices low and set purchase limits to counter increased demand, limited supplies or both.
Brian Moscogiuri, the executive vice president of Eggs Unlimited, a major domestic egg supplier, said many stores that want to stock eggs work with brokers like his company.
But the eggs are only one challenge. The carton is, increasingly, another. The eggs that Mr. Moscogiuri’s company provides often are packed in generic cartons, without any particular brand name or grocery-store private label; it is the egg suppliers who possess branded cartons for a variety of grocery stores and egg companies. So if a retailer carries only store-brand eggs, and its supplier is hit by bird flu, the production process is further complicated.
Discount grocers like Aldi and Trader Joe’s famously rely on private labeling to keep their costs low. Trader Joe’s, for example, offers at least nine egg options (organic, pasture-raised, “dark yolks,” and so on), but all are in Trader Joe’s-branded cartons.
“Stores that sell only private-label brands, I suspect, are more susceptible to supply shocks of this nature,” said Ozgun C. Demirag, the director of the Black School of Business at Pennsylvania State University.
Bigger chains, like Kroger, have much more room to maneuver. “Kroger carries a mix of national brands as well as its own private label,” Dr. Demirag said. “It’s more product variety and then also a more diversified supplier base.”
Smaller grocery chains and mom-and-pop stores not operated by the Albertsons and the Walmarts of the world are unlikely to discount eggs aggressively because they can’t absorb as much loss.
“You don’t have other aisles where consumers are shopping for tires or workout apparel where you can make some of that up,” said Karyn Rispoli, the egg managing editor at Expana, which tracks the price of eggs, adding: “Even at these high prices I would venture to say they’re still selling below their cost because they want to make sure they’re not losing their customer base.”
Stores across the country have instituted egg purchase limits, but they’re more common at grocers known for low prices. On Saturday, the Aldi in Inglewood had a two-dozen limit. Trader Joe’s has imposed a one-dozen limit nationally.
Costco is limiting customers to three 24-count packages of eggs at some locations across the country. Purchase limits help temper panic-buying, or spikes in demand caused by lower prices.
“I think Costco tried to learn from the toilet-paper shortage,” said Rudolf Leuschner, a professor of supply chain management at Rutgers. “As soon as you announce the shortages, everybody goes to the store and buys eggs, which makes it a lot worse. It’s not a bad strategy to then institute some purchase limits.”
