The Journal. - Big Egg’s Price Fixing Scandal

Episode Date: July 10, 2026

Record-breaking egg prices in recent years were blamed on an avian flu outbreak. But a recent Department of Justice complaint spells out another cause: a scheme among some of America’s top egg producers to bid up the cost of eggs. WSJ’s Patrick Thomas explains how they allegedly manipulated the “Wall Street of Eggs.” Jessica Mendoza hosts. Further Listening: - Eggs Are Still Expensive. Is This Company to Blame? - An Eggspensive Dilemma Sign up for WSJ’s free What’s News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices

Whenever we need someone to crack the code on egg issues, we turn to our resident egg spurt, agriculture reporter Patrick Thomas. And I guess for the journal, we can call you our egg correspondent at this point. I mean, you talk about other stuff with us. Of course. But I feel like this is the thing you come back for. Isn't it fun to talk about eggs again? It's been like how long has it been?

About a month? Or I'm just kidding, a year or a couple months. About a year ago, Patrick talked to us about egg inflation. Prices were soaring and customers were upset. The Agriculture Department predicts egg prices could soar another 20% this year. Egg prices are at an all-time high. The consumer price index says they rose yet again last month to $6.23 per dozen. At the time, egg producers blamed those sky-high prices on bird flu,

which was absolutely deadly for America's egg-laying hens. As of last year, more than 150 million chickens and turkeys had been killed by the virus. But it turns out there was another reason for those crazy egg prices. Just last week, the Department of Justice laid out the findings of a more than year-long investigation. The department has come out and outlined some behavior by executives at some of the big egg companies.

saying essentially that there was a coordinated effort among executives to try and keep egg prices high as long as they could. The word that comes to mind is conspiracy. Is that fair? That's what the Department of Justice would say. Welcome to The Journal, our show about money, business, and power. I'm Jessica Mendoza. It's Friday, July 10th. Coming up on the show, Inside Big Eggs' Price Fixing Scandal. The intricacies of the egg supply chain start with a chicken, or, you know, a lot of chickens.

So in Egg World, there's kind of these massive complexes spread out across rural America that house tens of thousands of hens. In some case, hundreds of thousands of hens. Ideally, egg producers have one. one egg laying hen per person in the U.S. That number keeps supply at a place where producers say they can make a decent profit. And we went over this before and past episodes. Every person eats about an egg a day, right? I think we went over that and everybody's got their own...

Yes, we did that mass. We all have our own personal chicken. We have our own personal chicken laying hens. And when that gets out of whack one way or the other, too many, too few, it messes with the prices. That's what the bird flu did. The virus wiped out millions of birds across the country, and they weren't easy to replace. You know, we're dealing with live animals. You can't just turn on and off the sink of eggs, right?

You can't just call up more hens from the bench, so to speak, and bring them online. So fewer hens meant fewer eggs meant higher prices. But after a couple of years of egg prices staying high, some people started wondering if they're might be something else going on as well. Some advocates and some different nonprofit NGO groups in the background, some lawyers, people started questioning if the prices that we were seeing at the grocery store went beyond just supply and demand dynamics that the companies were harping on. Was there other activities going on where the companies were basically never letting a good

crisis go to waste, right? Basically, was the bird flu providing cover for price gouging? The questions came as the price of eggs became a political issue, swept up in bigger dissatisfaction with inflation and the rising cost of living. So the backdrop is we just finished up the 2024 election. Food inflation was a really big topic in that presidential election. Oh, yeah. You can almost hear the soundbites. Joe Biden especially let the price of eggs get out of control.

The egg price is out of control. And we're working hard to get it back down. Eggs were at the time the poster child of food inflation. And the Trump administration wanted to come in and get egg prices down. One of the first things his DOJ did was starting an investigation into egg pricing and some of the largest companies into their behavior and how eggs were being priced. And if there was gouging, they were going to look into it. In March of last year, the Justice Department opened its investigation into the egg industry,

which is actually pretty concentrated. About 60 companies produced nearly 90% of all eggs in the country. In other words, big egg is actually a pretty small group. After spending over a year on its investigation, the DOJ filed a complaint at the end of June. And so what did they find? What were the allegations from the DOJ? What the Department of Justice ended up coming back with was they singled out executives from three companies, CalMaine, Versova, which is in the top five of biggest egg companies.

In fact, CalMaine is the top egg producer in the country, making about a fifth of the U.S. egg supply. And then you have a much smaller player called Hickman's Egg Ranch, but they singled out these three companies. And what they say is that these executives, Over the course of the bird flu outbreak, exchanged messages, spoke over the phone, to manipulate a little-known process that helps determine the price of how much Americans pay for eggs. So tell me about that process.

Like, how does egg pricing work? Consumers know very little about this process. It is very niche. So let's take a step back for a second and think about the broader egg market. It is a top. business historically. It's really easy to crash the market. These are commodities. They require a lot of grain. Costs can fluctuate. And because of that, egg producers purposely underproduce to avoid

flooding the market and tanking prices. So when they get orders they can't fill because they don't have enough eggs, they go to this very special place, the egg clearinghouse. That's where they bid for eggs from other egg producers to fulfill those orders. This kind of esoteric, on an online wholesale egg marketplace that is fondly nicknamed the Wall Street of Eggs. So on a normal day, like half a dozen to a dozen companies exchanging what are called bids. So somebody has eggs to sell, somebody places a bid for the egg to secure them. So an online auction of sorts for the eggs. And so it is around this egg clearinghouse, this Wall Street of Eggs, and the process,

around it, that these executives' alleged scheme kind of centers, right? So tell me, how did it work? What did the Justice Department say? It was the first year of this bird flu outbreak, 2022. And the chief executive of Hickmans, the smaller egg company among the three, had an idea for how to push the price higher. If they all started bidding really aggressively during this time period and flood the clearinghouse with bids,

they could lead to higher prices because it'll look like there's a lot of market activity still going on. And if they bid higher prices, that could keep the price up, then maybe it normally would have been. The Justice Department alleged that this scheme started in 2022 and ran through 2025. Texts and call logs from that period

show executives at the three egg companies in question, CalMaine, Versova, and Hickmans, talking about bidding up prices. That kind of coordination can be good for business, but it's also classic collusion. They're supposed to be competing and keeping prices down. This scheme mapped onto bird flu outbreaks. In December 2024, when egg prices started ticking up

after a new round of bird flu cases, Hickman's CEO got a text from Calmain's former CEO, saying, quote, let it rip, end quote. That's according to the complaint. An alleged co-conspirator said that as a group they needed to bid, like they vote in Chicago early and often, basically saying that they needed to keep flooding that market with bids. Cal Main, Versova, and Hickmans have all denied wrongdoing. CalMaine also said the communications cited in the Justice Department complaint didn't affect egg prices and that the company's conduct was lawful and supported the market. The CEO of Hickmans, who served in the role until selling the company late last.

year declined to comment. What this alleged scheme did to the price of eggs in the end? That's after the break. This episode is brought to you by Accenture. When your advertising operations fall out of sync, everything else follows. Spotify and Accenture are working together to reinvent the rhythm of ad sales, using automation, analytics, and smarter workflows to simplify campaign delivery and access better data across the business.

The result? Less time spent on operations. more time connecting brands with the moments and fandoms that matter most. Learn more at Accenture.com slash Spotify. Beyond the allegations that the egg companies colluded to bid on eggs at the same time and raise prices, the Justice Department alleges that they used another technique, so-called spoofing tactics. It's basically a bluffing strategy in which a trader places buy or sell orders, which they

would do on the egg clearinghouse, hoping to move a price. but then cancels the order before they are filled. So putting fake orders out there at certain prices and then deleting them. For example, the complaint says that in 2022, Versova, one of the really big egg producers, placed a high bid. Then, when other companies started offering eggs at that price, Versova deleted its bid. And these spoofing-like tactics allegedly went on as egg prices continued to climb, peaking at a nationwide average of over $6 a dozen in March.

March of last year. And, according to the Justice Department, the executives celebrated these rising prices. After egg prices continued hitting records, the Hickman CEO said, great job in the Northwest today. And what he was trying to say was the price of eggs in the Northwest were pushed higher at following their bids. So basically touting this is a sign of success. Well, in the end, how much of those high prices that we saw, you know, between 2022 and 2025 was due to this scheme versus, you know, the bird flu? Unfortunately, I don't have a great answer for this one, but the bird flu is still the ultimate driver that got us to eggs above $6 a dozen in 2025. is ultimately what led to huge supply shocks and, you know, eggs surcharges at restaurants and limits on buying two cartons of eggs at the grocery store.

All of that, according to the Department of Justice, was something that the egg companies took advantage of. I think when you have kind of crazy time periods like the bird flu, it does provide some cover for this. And I think that's what the Department of Justice is spelling out here, is that this was a crisis that executives used to toss higher bids around because prices were going crazy and it was a great time to throw out higher numbers

and float the market with bids. And you could kind of get away with some of this more reckless behavior in an area where there's not a lot of trades on this Wall Street of eggs. The DOJ complaint didn't tally up the overall cost of the raised bids. It just said that these bids did move the price of eggs on grocery shelves by a certain amount. What law are they breaking by doing this? Well, the Department of Justice is saying that they're, I mean, they're colluding as competitors.

They're colluding to keep prices high. And it's a textbook civil case that they're bringing, basically. What they do outline is that the companies did talk amongst each other in ways that were meant to try and keep the prices higher for longer periods of time, which they shouldn't do. Right. And what did the egg companies say to that? What was their defense? Their defense has been they wanted to make money during times when prices are high so they can kind of keep it away, put it back in the coffers. Because inevitably, and you're seeing this right now, actually, is if bird flu cases went down, egg prices were going to plummet. And that's exactly what happened. Egg prices are extremely cheap right now.

Egg companies are not quite losing money, but they're struggling again. Balance sheets are tighter. And Cal Main's logic was we're going to take this, we're going to sit on our cash, and you're saying even right now they've been spending on acquiring some breakfast foods and prepared foods to kind of have some more stable earnings. Ultimately, the Justice Department decided to settle with the egg producers. Usually that means the defendants would have to pay a fine, a restitution, to settle the claims. But they actually agreed in this time to settle the case by donating more than 50 million eggs to food banks

and paying about $3 million to New York and other states that helped investigate the alleged misconduct. So a little bit different than kind of a normal settlement. An egg donation as a settlement. An egg donation is a settlement. As part of the settlement, egg producers don't have to admit to any wrongdoing. And some of the same critics who were unhappy

with high prices to begin with aren't happy with this outcome. Like this group called Farm Action, which was very vocal in terms of, of this in terms of trying to hold the egg companies accountable, have said that this settlement didn't go far enough. They said they should be fined more, that this alleged behavior scratches the surface, that this just isn't thorough enough and isn't strict enough punishment to deter this from happening in the future, kind of accusing it as a cost of doing business and washing their hands of this

and then being done with it and saying, we'll forget about this and not too distant future. From a consumer perspective, you know, people have been really frustrated with high prices. We talked about kind of the anger and the way that the price of eggs became kind of the poster child for how expensive things we're getting. What do you think this story reveals? I think this story reveals that, you know, our food system is pretty fragile in a number of ways, not only. only through supply and demand shocks. But, you know, these companies and executives do talk amongst one another. And I think when you read this complaint, you get an idea of some of the reckless things that they can say to one another. You know, I think we learn a little bit

how easily this system can be manipulated in a crisis. Again, not letting a good crisis go to waste. That's kind of the theme of this. Well, Patrick, thank you, as always, for your excellent reporting. Thank you for having me on. It's always fun to explain the world of eggs. That's all for today, Friday, July 10th. Additional reporting in this episode by Dave Michaels. The Journal is a co-production of Spotify and the Wall Street Journal. The show's made by Laura Benchhoff, Catherine Brewer,

Evelyn Fahardo Alvarez, Pia Gidcari, Max Green, Sophie Codner, Ryan Knutzen, Matt Kwong, Colin McNulty, Laura Morris, Enrique Perez de la Rosa, Sarah Platt, Alan Rodriguez-Espinoza, Heather Rogers, Pierre Singey, Givica Verma, Catherine Whalen, Tatiana Zemise, and me, Jessica Mendoza. Our engineers are Griffin Tanner, Nathan Singapok, and Peter Leonard. Our theme music is by So Wiley. Additional music this week from Catherine Anderson, Peter Leonard, Billy Libby, Bobby Lord, Emma Munger, Nathan Singapok, Griffin Tanner, So Wiley, and Blue Dot Sessions. Fact-checking this week by Nicole Pasolka.

Thanks for listening. Have a great weekend.