Preventing Egg Market Volatility in Australia: Strategies for a Resilient Industry

Recent global egg price fluctuations have demonstrated how vulnerable the egg supply chain can be to disruptions. According to a recent analysis from the Federal Reserve Bank of St. Louis, egg prices in the US more than doubled in some regions, with consumers paying over $6 per dozen in March 20251. While Australia's egg industry operates differently, these international events offer valuable lessons for our local market on maintaining stability and preventing similar price shocks.

The Australian Egg Market: Current Landscape

Australia's egg industry continues to show robust growth, with per capita consumption reaching 266 eggs in the 2023-24 financial year, up from 263 eggs in 2022-236. In total, Australian egg farmers produced 6.98 billion eggs (581.8 million dozen) in 2023-246, demonstrating the critical importance of this protein source to our national food security.The domestic production landscape features three main farming systems, with free range eggs now commanding 57.4% of grocery retail sales6. This shift in consumer preference has occurred alongside steady increases in overall consumption, highlighting the industry's adaptability to changing market demands. Unlike the US market which operates through the Egg Clearinghouse Inc. (ECI), Australia's egg distribution system has historically been more fragmented, creating potential inefficiencies during supply disruptions. This is precisely where centralized exchange platforms like EggX play a crucial role in connecting large-scale producers with buyers efficiently.

Threats to Australian Egg Market Stability

Avian Influenza: A Persistent Challenge

Recent events have demonstrated that avian influenza remains a significant threat to Australia's egg supply stability. In February 2025, Agriculture Victoria confirmed an egg farm in northern Victoria tested positive for H7N8 High Pathogenic Avian Influenza (HPAI)17. While different from the H5N1 strain causing widespread international concerns, this detection came shortly after Australia had declared itself bird flu-free following extensive eradication efforts19.The St. Louis Fed's analysis highlights how avian flu has severely impacted the US industry, with more than 168 million egg-laying hens euthanized since 2022, including 30 million in just the first two months of 20251. Such supply disruptions, when combined with the inherent characteristics of egg production, create significant market volatility.

Market Economics: Why Small Disruptions Cause Big Price Swings

The economics of egg pricing illustrates why relatively small changes in supply can trigger significant price fluctuations. As explained in the Federal Reserve analysis, eggs demonstrate both inelastic demand and relatively inelastic short-term supply1. This means consumers don't substantially reduce their consumption when prices rise, while producers cannot quickly increase production when demand exceeds supply.For Australia, where eggs represent a dietary staple and affordable protein source, these market fundamentals operate similarly. When avian flu outbreaks occur, the resulting supply disruptions can cascade through the entire market rapidly, affecting prices at both wholesale and retail levels.

Prevention Strategies for Australia's Egg Industry

Enhanced Biosecurity Protocols

Australia's government and industry bodies have developed comprehensive biosecurity guidelines specifically tailored to poultry producers. Agriculture Victoria emphasizes key practices including:

Keeping farm visitors to a minimum
Limiting visitations to other poultry farms
Keeping pets out of poultry houses
Practicing appropriate pest control measures5

For large-scale operations supplying through bulk exchanges like EggX, implementation of these protocols represents not just regulatory compliance but essential business continuity planning.

Rapid Response Systems

The February 2025 avian flu detection in northern Victoria demonstrated both the ongoing risk and the effectiveness of Australia's response systems. Agriculture Victoria immediately quarantined the affected property and implemented movement controls to prevent further spread17. The egg industry worked closely with government authorities, implementing increased biosecurity protocols on nearby properties.This coordinated approach between government and industry stakeholders represents international best practice for disease containment and should continue to be strengthened through regular drills and updates to response protocols.

Vaccination and Flock Management

While avian flu vaccines are not currently part of Australia's standard prevention strategy, research into their potential role deserves continued investment. The Federal Reserve analysis notes that in the long run, strategies like vaccination could help create more elastic supply by protecting flocks from disease outbreaks1.Effective flock management practices also play a key role in resilience. Australian producers should implement regular health monitoring, maintain appropriate bird density levels, and follow strict protocols for introducing new birds to existing flocks.

How Bulk Egg Exchanges Support Market Stability

The St. Louis Fed analysis highlights how the US egg exchange (ECI) helps "establish the wholesale price of eggs, which informs the retail price"1. Similarly, Australian bulk egg exchange platforms like EggX provide critical infrastructure for efficient market functioning, especially during supply disruptions.

Bridging Supply Gaps

When individual producers face challenges like disease outbreaks or production shortfalls, a centralized exchange platform allows other producers to efficiently fill market gaps. This capability becomes especially valuable during regional disease outbreaks when quarantine zones may prevent specific farms from supplying their usual customers.

Price Transparency and Discovery

By facilitating transactions between large farms and major buyers, bulk exchange platforms create greater price transparency across the market. This visibility helps producers make more informed decisions about production planning and allows for more efficient resource allocation throughout the supply chain.

Distribution Efficiency

The geographic distribution of egg production across Australia's states (with NSW producing 36%, Queensland 28.6%, and Victoria 22.3% of the nation's eggs in 2023-246) means that logistical efficiency is essential to market stability. Exchange platforms that optimize distribution can reduce transportation costs and minimize the environmental impact of moving eggs between production regions and consumption centers.

Conclusion: Building a More Resilient Australian Egg Industry

The recent Federal Reserve analysis of US egg market dynamics offers valuable insights for Australia's egg industry. By understanding how supply disruptions can trigger significant price volatility in products with inelastic demand, Australian stakeholders can better prepare for and mitigate such risks.For large-scale egg producers, participation in efficient exchange platforms like EggX represents not just a business opportunity but a contribution to national food security and market stability. Through improved biosecurity, robust emergency response protocols, and more efficient market infrastructure, Australia's egg industry can build resilience against the threats that have caused price shocks in other markets.As consumer demand for eggs continues to grow, with Australia's per capita consumption increasing steadily each year, investment in these prevention and resilience measures will benefit producers, distributors, retailers, and ultimately Australian consumers who rely on eggs as an affordable, nutritious protein source.

This article was prepared by EggX, Australia's first bulk egg exchange platform connecting large farms with major buyers across the country. For more information on how EggX can help optimize your egg supply chain, visit www.eggx.com.au