Rising egg prices hit businesses

by Ellen Schmidt

While the avian flu has forced the cost of eggs to rise, local breakfast joints have yet to increase their prices. 
And although the disease is now on the decline, egg costs have risen about one dollar per dozen since the March outbreak hit the Midwest.  
Dinkytown restaurant Al’s Breakfast buys about 2,400 eggs every week, co-owner Jim Brandes said.
“It’s lots of money that we have to come up with somehow, somewhere else,” he said.
Despite losing money from high-priced eggs, the business doesn’t plan to take egg dishes off the menu or up the cost in an effort to retain customers, Brandes said.
“We’re very slow to raise our prices, especially because this could be a temporary thing,” he said.
Tony’s Diner in Dinkytown, which buys about 3,600 eggs per week, is taking a hit from increased egg prices, too. But since business slows down in summer, owner
Tony Nicklow said raising prices could further decrease business, a risk he said he doesn’t want to take.
“If things don’t change, there would have to be a little bit of an increase [in price],” he said. “But it won’t hurt the customer too much.”
Should his egg dish prices rise, the increase won’t exceed a dollar, Nicklow said.
Twin Cities grocery store chain Lunds & Byerlys has seen a shortage of eggs, prompting increased egg prices in the past few months, spokesman Aaron Sorenson said.
The chain supplied all of its stores with signs warning customers of the egg shortage in case they ran out. The stores have also reduced their bakery and deli menu items that include eggs to only their most popular items, Sorenson said.
Prior to and at the start of the avian flu outbreak, Lunds & Byerlys bought eggs from Crystal Farms, but it has since switched to central Minnesota’s Sparboe Farms, which is larger and can supply more eggs, he said.
Since switching suppliers, the chain has experienced fewer egg shortages in the past month, Sorenson said.
The outbreak has been declining, with the last documented case in Minnesota on June 5.
The pause in new cases is expected to continue into the summer, said Steve Olson, executive director of the Chicken and Egg Association of Minnesota, due to warmer weather, more sunlight and increased immunity in wild birds.
But as the avian flu wanes, egg prices won’t return to normal right away, he said.
“It’s going to be a good year and a half — maybe two years — before those farms that have infected flocks get back into full production,” he said.
Egg-producing farms need time to go through a cleaning and disinfecting process, leaving the barns empty before they can introduce new hens, he said.
“If we can come back to full production, egg prices will be a short-term spike,” said Brigid Tuck, an economic impact analyst who led a University of Minnesota Extension study on the economic impact of avian flu. 
“The real question that’s out there in the industry right now is if we’re going to get a second round of this in the fall,” she said.