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Egg prices up 70% compared to a year ago

Easter eggs won't come cheap this Easter.

Per Tuesday's CPI report, egg prices are up 70.1% year-over-year, though the cost is rising at a slower rate than last month, up 8.5% month-over-month from December to January. Back in December, the monthly inflationary report showed the cost of eggs jumped 59.9% year-over-year and 11.1% month-over-month from November to December.

[Read more: Inflation rises 0.5% over last month in January, most since October]

Per the U.S. Bureau of Labor Statistics, the average price per a dozen large Grade A eggs is $4.82. The Avian flu outbreak continues to drive prices higher as farmers work to rebuild their flocks. In 2022 overall, the total number of egg-laying birds lost to the flu increased to 43.3 million birds.

Kevin Bergquist at Wells Fargo said, "As of January 1, 2023, the size of the U.S. laying flock was 306.38 million hens, which is 1.0% lower than the number of layers reported on December 1, 2022 due to another large loss of hens in December. However, January’s number is up 2.5% from the low point of the number of layers reported last year in June 2022 (298.69 million hens)."

Bergquist said the outbreak "could get worse before it gets better, or maybe not if we’re lucky."

He added, "There was another confirmed case of HPAI in the U.S. just announced this week..The industry is hyper-aware of the ongoing current infection risk and is undertaking many additional measures to try and blunt further infections."

Some good news is on the way though since this report is a look back.

David Anderson, a Texas A&M professor said, "Wholesale prices are dropping rapidly. For a while in December and maybe early January wholesale prices were higher than retail. That has likely switched with falling wholesale prices."

Bergquist said his guess is that "consumer egg prices could and/or should be comparatively lower now and in the next few weeks."

Bergquist added, "How changes in wholesale prices compare to a consumer retail price is usually not a direct one-to-one relationship due to grocers’ promotions and other decisions made at the retail grocery level."

However, with the Easter season on the way, prices could go higher once again. As for a potential bump, Bergquist said, "More than likely, yes. The consumer demand for eggs generally increases around the Easter holiday, and higher demand often results in higher prices."

But consumers' response to these prices by not buying eggs also plays a role in prices.

Anderson said, "We’ll see if consumers pull back given the price. It’s likely that a consumer pullback is what’s driving lower wholesale prices. While production is coming back slowly consumers can act quicker in response to high prices."

Brooke DiPalma is a reporter for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma or email her at bdipalma@yahoofinance.com.

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