By Taryn Phaneuf | NerdWallet
It wouldn’t be Easter without colorful eggs and chocolate bunnies. But threats to the supply of these holiday essentials are causing prices to go up at a time when shoppers are tired of years of high inflation.
Here’s a look at why inflation is having a significant impact on your Easter basket.
Cocoa prices are rising with no sign of relief
Chocolate prices have gone up nearly 38% since 2020, the year before inflation began to increase, according to NielsenIQ market research data given to NerdWallet. Lately, price increases have been caused by the soaring cost of cocoa, the main ingredient for chocolate.
A series of severe weather events, as well as disease, have badly affected cocoa crops in West Africa, where about 70% of the world’s cocoa is grown. As a result, cocoa prices are at their highest levels.
So far, there are no signs of cocoa prices changing for the better, says Billy Roberts, food and beverage economist with CoBank, a Colorado-based lender specializing in agriculture. Initial reports on next season’s harvest — which takes place in late summer and early fall — are not as positive as the industry had hoped. Until crop yields improve, cocoa prices will likely remain high.
Roberts says chocolate makers have realized that constantly increasing chocolate prices are not sustainable. While shoppers spent more money on chocolate in each of the past two years, they did so while buying less of it, according to NielsenIQ data.
But that doesn’t mean prices will drop. Instead, Roberts says, packages will shrink. “It’s not necessarily that they’re trying to deceive the consumer, but they’re trying to offer a product at a price point that consumers are comfortable paying.”
Egg prices have risen by 47% since August
While chocolate might be a luxurious purchase for grocery shoppers, eggs are a necessity. So, even when it isn’t Easter, consumers tend to pay close attention, egg prices says Brian Earnest, an animal protein economist with CoBank.
“People remember the last time they bought a dozen eggs, just like they remember the last time they filled up the gas tank,” Earnest says.
Just like in recent years, there’s been a lot to pay attention to. The average cost of a dozen Grade A large eggs was $2.02 around Easter 2020, according to data from the U.S. Bureau of Labor Statistics, retrieved from the Federal Reserve Bank of St. Louis’ FRED site, a 38% increase from January of that year. That brief surge was caused by sudden changes in consumer demand due to the COVID-19 pandemic. gas prices By Easter 2021, the average price of a dozen eggs was $1.62. The following year, it rose to $2.52, and prices continued to rise through 2023.
Eggs have been costly in the past two years mainly because of a highly contagious and deadly avian flu that has devastated the U.S. egg supply. The virus is the main reason U.S. consumers saw the average price of a dozen eggs more than double between January 2022 and January 2023, when it peaked at $4.82.
Prices dropped to an average of $3.27 per dozen around Easter last year and stayed that way until the fall. That was partly because egg producers were not seeing new cases of bird flu and had an opportunity to rebuild their flocks. But farmers reported a new outbreak in November.
Egg prices have been rising over the last six months. In February, a dozen eggs cost $3 on average, which is 47% higher than the $2.04 price in August.
Earnest believes that this outbreak will not raise prices as much as it did in 2022 and 2023, partly because chicken farmers have made improvements to protect their flocks. However, with spring comes migratory birds, which have caused avian flu outbreaks by spreading the virus to farm animals when flying north.
Even though there have been fewer new cases of bird flu recently, Earnest says that there is still a higher risk to the flocks during this season.
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The article originally appeared on Bad weather and disease are stressing the cocoa supply, while another outbreak of bird flu is causing egg prices to rise again. NerdWallet.
