As eggflation skyrockets, the government suspects farm-gate price collusion

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As eggflation skyrockets, the government suspects farm-gate price collusion

Published: 03 Jun. 2025, 09:49 Updated: 03 Jun. 2025, 10:39

Audio report: written by reporters, read by AI

Eggs are sold at a retail shop in Seoul on May 30. [YONHAP]

Retail prices of eggs are surging across Korea despite a stable supply, prompting concerns that producers may be colluding to inflate farm-gate prices.

According to the Korea Institute for Animal Products Quality Evaluation, the nationwide average consumer price for a pack of 10 extra-large eggs was 3,876 won ($2.82) as of June 1, up about 19 percent from 3,266 won at the end of last year.

Among major local governments, North Chungcheong recorded the highest average at 4,680 won. In the Seoul metropolitan area, Incheon had the highest price at 4,440 won, while Seoul and Gyeonggi remained close to the national average at 3,867 won and 3,863 won, respectively.

The nationwide average egg price in May was 3,793 won — the highest since June 2022, when it reached 3,817 won. The overall consumer price index rose about 16.4 percent compared to 2020, while the egg index jumped 37 percent over the same period.

The recent retail price surge is attributed mainly to a sharp rise in farm-gate prices in March. The average monthly farm-gate price for one egg rose more than 23 percent, from 146 won in February to 180 won in March.

Poultry farmers cite several reasons: a decrease in supply due to outbreaks of highly pathogenic avian influenza (AI), increased exports to the United States and rising production costs following government regulations to improve animal welfare by expanding the minimum cage space for laying hens.

Despite these claims, the government believes the jump in farm-gate prices is excessive. It estimates the impact of AI to be minimal, with approximately 4.9 million birds culled during the winter — a relatively small number. The volume of egg exports to the United States was also too low to justify domestic price hikes, accounting for less than 1 percent of total production.

Additionally, the number of eggs graded and approved for sale has actually increased, from 112.31 million in January to 130.58 million in April. The animal welfare regulation requiring larger cage space is only scheduled to take effect in September 2027. While some farms may have preemptively upgraded their facilities, the government points out that it has eased regulations — including raising the permissible building coverage ratio from 20 to 60 percent and increasing cage stacking from nine to 12 tiers — while expanding financial support to offset related costs.

Given these factors, the Ministry of Agriculture, Food and Rural Affairs suspects that producers may be colluding to fix prices.

Eggs are sold at a retail shop in Seoul on May 30. [YONHAP]

The ministry has completed field inspections and plans to expand its investigation to the broader distribution process. The Fair Trade Commission stated that it will review whether to open a formal investigation once it receives the ministry’s findings.

Eggs are a staple ingredient in Korean households. Per capita egg consumption in 2023 was 14.3 kilograms — a 3.6 percent increase from the previous year. Rising egg prices affect not only consumers, but also food manufacturers that rely on eggs for processed products. As such, there are growing calls for structural reform of distribution channels and long-term stabilization measures.

The Korea National Council of Consumer Organizations’ Price Monitoring Center has proposed diversifying feed import sources and developing alternative feed to ensure a stable supply.

“Labor costs are also rising due to minimum wage hikes,” said the center’s accountant Park Hee-woong. “The government should support farms in adopting smart farming technologies.”

Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff.
BY KIM MIN-JOONG [[email protected]]