Cal-Maine Foods is the largest egg distributor in California. Their recent financial report describes the company as the following: “Cal-Maine Foods is primarily engaged in the production, grading, packaging, marketing, and distribution of fresh shell eggs, including conventional, cage-free, organic, brown, free-range, pasture-raised, and nutritionally enhanced eggs. The company is the largest producer and distributor of fresh shell eggs in the nation and sells most of its shell eggs throughout the majority of the United States.”
They recently released their financial statement for year ended November 2024. Here’s a direct passage from that report:
Max Bowman, vice president and chief financial officer of Cal-Maine Foods, added, “For the second quarter of fiscal 2025, our net sales were $954.7 million compared with $523.2 million for the same period last year. The higher sales were primarily driven by an increase in the net average selling price of shell eggs as well as an increase in total dozens sold.”
The primary egg distributor in California had a one-year 84 percent increase in net sales income. This past year their gross profit went up from $91.13 million to $356.02 million. And it came out of our pockets.
There is nothing referring to their loss of egg laying birds as we have been told is the reason for the price of eggs to have almost doubled in price in the last year.
This is the same ploy oil companies have used, claiming there is a shortage therefore the prices have to increase. It’s a corporate manufactured diversion from the real reason egg prices are what they are; because Cal-Maine can. Just like the big oil companies could. And oh, by the way, the stock price for Cal-Maine is up 96.73 percent for the past year.
Here’s more from the Cal-Maine financial report: “Overall, our second quarter farm production costs per dozen were 8.5 percent lower compared to the prior-year period, primarily due to more favorable commodity pricing for key feed ingredients. For the second quarter of fiscal 2025, feed costs per dozen were down 12.8 percent compared with the second quarter of fiscal 2024.
Cal Maine’s production costs are down almost 13 percent yet their net income went up 84 percent! The wholesale cost of a dozen eggs went up from $1.66 to $2.57, a 54 percent price increase!
This gouging has significant economic ripple effects. Eggs are a basic food commodity; they are an ingredient in countless numbers of food production. Cal-Maine knows consumers will pay the increase because we have to, like the price of gas, whatever oil companies charge we pay because we have to have gas. And we have to have eggs for ourselves and our food production.
Cal-Maine’s egg price gouging is a major squeeze on consumers. What’s a restaurant to do? Bakeries? Corporate food manufacturers? Raise prices. And Cal-Maine’s unregulated profit-driven increases in egg prices have little to do with avian flu.
Here’s what they give as the reason for price increases: “Current indications for corn and soybean supply project a favorable stocks-to-use ratio similar to today’s prevailing levels for the remainder of fiscal 2025. However, as we continue to face uncertain external forces, including weather patterns and global supply chain disruptions, price volatility could remain,” Bowman said.
Nothing about what we are being told that record egg prices are due to the culling of their egg laying birds. That doesn’t seem to be anything the company is worried about in its financial report.
The gouging price of eggs distorts the inflation reading, which affects interest rates. And eventually will cause job loss. Less sales in restaurants and food products leads to fewer hours for employees and potential layoffs. In California, restaurant owners have been hit with a $20 an hour minimum wage. When a basic component of their recipes has had a significant price increase, there’s a limit to how much a business can increase their prices.
With everything being as high as it is, consumers can only afford so much before we stop doing it.
What needs to be done is for California state legislators to regulate the food distribution industry. State Sen. John Laird, Assemblymember Dawn Addis, and Gov. Gavin Newsom, please do something about the uncontrolled price gouging of Cal-Maine and other food distributors. The affordability of food is the foundation of all our lives. If in the wrong hands, there’s nothing that will cause more social unrest then hunger among masses.
For immediate action, eat fewer eggs. Have one less with your breakfast, there’s many ways to get morning protein. Like oil, we can’t boycott eggs, but we must collectively send a message to Cal-Maine that we will not buy into their greed. Or fund it.
See calmainefoods.gcs-web.com for the entire Cal-Maine financial report. Δ
Gary Freiberg writes to New Times from Los Osos. Send a response for publication to letters@newtimesslo.com.
This article appears in Jan 16-26, 2025.
They have a history of price gouging such that a court ordered them in 2023 to pay out $17 million in damages for price gouging throughout the 2000s. They pulled this same “blame the avian flu” thing 2 years ago. Even if there are things that increase costs in production, those should only be passed down to consumers if production savings are too instead of executives and shareholders. There is no way they should be seeing increases in profit exceeding 300%, especially with label prices that high and agricultural pandemics that seem to be more common.