Dispute with producers behind 'egg price mystery,' officials say

Eggs are displayed at a supermarket in Seoul on June 17. [YONHAP] With school cafeterias closed for the summer, demand for eggs should be down. Yet a carton has stayed above 7,000 won ($5) — the highest level in years — for four straight months, defying seasonal patterns in what officials call an “egg price mystery." Extreme heat has played a role, but the government points to its dispute with the Korea Egg Producer Association (KEPA) — which has left egg prices without an official benchmark for 100 days — as the fundamental cause. Related ArticleExtreme heat threatens poultry farms across Korea this summerFTC launches probe into egg price conspiracyEgg prices expected to remain high through August due to aging hens, avian flu The average retail price of 30 medium-sized eggs stood at 7,115 won from Aug. 1 to 28, according to the Korea Agro-Fisheries & Food Trade Corporation on Thursday. Prices first crossed the 7,000 won mark in May at 7,026 won, the first time since July 2021, and have remained above that threshold for four months. Consumption has steadily increased as eggs cement their place as a staple food. Average daily per-capita consumption rose from 0.82 eggs in 2021 to 0.95 last year. On the supply side, extreme heat has increased mortality rates, while avian influenza outbreaks have led to the culling of 2 million chickens this year. A chicken drinks water amid extreme heat at a poultry farm in Naju, South Jeolla, on July 10. [NEWS1] Even accounting for these factors, the sustained 7,000-won level is unusual. It is nearly 10 percent higher than the historical August average of 6,561 won. The government rolled out strong anti-inflation measures in May, but prices have not responded. Normally, egg prices decline in the summer as school lunch demand falls. This year, however, prices rose through August. Government officials point to a dispute with KEPA, which stopped publishing benchmark farm prices on May 22 following a Fair Trade Commission probe into suspected collusion. That left the wholesale price for medium eggs stuck at about 190 won per egg. The association stated that it halted publication solely due to the investigation. “If supply exceeds demand, prices should naturally fall, but if they remain steady, that means the price reflects fair value,” KEPA said. The government, however, argues that in the absence of updated benchmark prices, farms continue to follow the May level. Customers look at eggs stocked at a supermarket in Seoul on June 8. [YONHAP] Unlike most agricultural products, eggs do not have wholesale auction prices because they are fragile, produced daily, and difficult to grade by appearance. Instead, producers and distributors trade directly, often using the association’s published price as a reference. That practice dates back 60 years. The benchmark helped farmers in the past, when retailers often delayed payments for weeks and adjusted them based on quality assessments and downstream sales. The published price gave farmers some income stability. But since the 2021 avian influenza crisis, officials say the benchmark has gained outsized influence. Distributors, who once held the upper hand, lost bargaining power as supply tightened. “Farm prices are essentially a forecast and a seller’s asking price. They rise immediately when conditions tighten, but they adjust slowly when conditions ease,” a Ministry of Agriculture, Food and Rural Affairs official said. “Right now, prices are stuck at a peak level, and distributors are struggling.” Eggs are on sale at a traditional market in Seoul on Aug. 10. [NEWS1] The government wants to scrap the association’s benchmark and let the market set prices. To support this shift, the Korea Institute for Animal Products Quality Evaluation will begin publishing weekly supply and demand data. The government also plans to introduce standard contracts to eliminate deferred settlement practices and to establish a pricing system that reflects quality. However, KEPA Chairman Ahn Doo-young countered that the government cannot yet accurately track conditions at the farm level. “Eggs are highly sensitive to weather and disease, and they are produced daily with a short shelf life. Until the government can properly assess conditions at the producer level, the association must continue publishing benchmark prices,” Ahn said. Reform efforts face hurdles, as cooperation from farmers is essential for accurate data collection. Past attempts to overhaul the pricing system have repeatedly failed. While the government aims to expand its survey pool to 170 farms, only about 40 currently participate in the program. “This is not an easy task, but the need for reform has been clear since 2023," an Agriculture Ministry official said. "We began a research project in 2024 and launched a consultative body. This time, we are determined to push through,” the official said. “If abnormal pricing continues, farmers will also suffer in the long run. We plan to negotiate with the association in September to normalize prices as soon as possible." This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.BY KIM YEON-JOO [kim.juyeon2@joongang.co.kr]