Egg Prices Hit Record High As Retailers Brace For Tariff Fallout
Egg prices hit record highs in the latest Consumer Price Index (CPI) report, alongside increases in the average prices in other staple food categories. The increase comes as retailers continue to brace for the effects of President Donald Trump’s global 10-percent tariff rate — which remains in effect despite a 90-day pause on more stringent penalties.
The CPI for March was generally positive, but while inflation slowed and overall consumer prices fell by fractions last month, celebrations over the month’s better-than-expected pricing have been tempered because of Trump’s tariffs, which could wipe out gains as producers and retailers react to increased costs of imports from around the globe.
According to the Bureau of Labor Statistics, which produces the CPI, “The food at home index rose 0.5 percent over the month as four of the six major grocery store food group indexes increased. Driven primarily by a 5.9-percent increase in the index for eggs, the index for meats, poultry, fish, and eggs rose 1.3 percent in March. The beef index also increased over the month, rising 1.2 percent. The index for other food at home increased 0.5 percent in March and the index for dairy and related products rose 1.0 percent. The nonalcoholic beverages index increased 0.6 percent over the month.”
The average price of eggs hit a historic peak of $6.27, up from $5.90 in February. Notably, the retail price of eggs continued to increase despite a marked decrease in wholesale prices for distributors. U.S. poultry producers have been pummeled by a series of bird flu outbreaks that led to unprecedented flock culling and a national shortage of the staple grocery item.
The high price of eggs became a cudgel for President Donald Trump and his campaign to browbeat the Biden administration over the high price of consumer goods, and persistent inflation. As egg prices continued to increase in the first months of his presidency, Trump’s Justice Department launched an investigation into alleged price fixing by retailers, and moved to facilitate the importation of eggs from other countries.
These imports may now be subject to — at minimum — 10-percent tariffs.
On Wednesday, Trump announced that he would be authorizing a 90-day pause on the implementation of global reciprocal tariffs for most countries. China, the United States’ third-largest trade partner, was slapped with a jacked-up tariff rate of 125 percent. After hours of initial confusion, the White House clarified that most countries would still be subjected to a 10-percent baseline tariff on all imported goods, and Canada and Mexico — the nations two biggest trade patterns — would be subject to additional penalties on goods not covered by the USMCA trade agreement.
While financial markets celebrated what sounded like a reprieve, American retailers are not convinced. Walmart, the nation’s largest retail company, imports large swaths of its inventory from China. “We are one week into this new tariff environment, and we’re still working through what it means to us,” CFO John Rainey said during an investor meeting on Wednesday. “The uncertainty and decline in consumer sentiment has led to a little more sales volatility week to week and frankly, day to day.”
