Egg prices cracked to a record high in September, nearing $3.00 per dozen, as the poultry industry continues to reel from the outbreak of bird flu in the Midwest this year. So far, the disease and attempts to contain it have killed nearly 50 million birds, most of them egg-laying hens, causing egg prices to rise 50% since May. This outbreak has not harmed human health.
While there have been no new cases reported since June, some epidemiologists fear that the return of cold weather and migrating wild birds could spread the virus this winter, renewing the threat to already thin US poultry flocks.
For non-poultry farmers, this potential threat could still have a major impact, as chicken and eggs are the major protein alternatives to dairy, beef, and pork. Additionally, the poultry industry is a major source of demand for corn and soybean meal, so a weaker US poultry industry could ultimately hurt grain demand as well.
For now, shoppers can only hope for healthy hens to drive prices back down.
Quakes Shake Crude Market
A recent rise in seismic activity near Cushing, Oklahoma is shaking up the oil market. Cushing is the heart of the United States' oil infrastructure and is the designated point of delivery for futures contracts. As a result, it is the main point of transit for crude oil in the US and holds over 50 million barrels of crude oil, about five percent of the total US supply.
The town was hit with a 4.5 magnitude earthquake last Saturday, one of the strongest quakes in Oklahoma in the last decade. Many scientists are linking a recent rise in earthquakes to the oil and gas industry's practice of injecting wastewater into empty wells. Magnitude 3.0+ earthquakes have risen from an average of less than 2 per year from 1978-2008 to an earth-shattering 584 quakes in 2014.
For oil traders, there is a looming threat that a larger earthquake could strike storage or pipeline facilities, throwing the market into disarray. Meanwhile, increasing concern about the rise of earthquakes is prompting increased regulatory scrutiny, which could ultimately force changes to the oil and gas industry, potentially increasing costs and reducing supply.
So far, the crude oil market, trading Friday for $46.75 per barrel, has been largely shielded from these fears, but traders are watching closely for signs of trouble.