Cal-Maine Foods, Inc. reports it is cooperating with an investigation by the U.S. Department of Justice’s antitrust division into egg price increases resulting from outbreaks of highly pathogenic avian flu (HPAI).

Reports of the DOJ’s investigation surfaced in March. In its FY25 third-quarter financial statement, Cal-Maine acknowledges it received a civil investigative demand from the DOJ the same month.

Cal-Maine says net sales reached $1.4 billion in the third quarter of FY25, up from $703.1 million for the same period last year. The company’s net income reached $508.5 million in the third quarter of FY25, compared with $146.7 million for the third quarter of FY24.

The company attributes higher net sales to increases in the net average selling price and higher volumes of shell eggs. Cal-Maine Foods also reports higher market prices are a result of reduced shell eggs supply across the industry during a period of peak seasonal demand for eggs and egg products. 

For the third quarter of FY25, Cal-Maine reports a net average selling price per dozen was $4.060, compared with $2.247 a year ago. The company says the net average selling price reflects a blend of higher market-based prices for most conventional eggs with lower negotiated-price arrangements for specialty eggs, based on long-standing pricing frameworks the company honors. 

Cal-Maine reports it sold a record 331.4 million dozen shell eggs, representing a 10.2% increase, including the contribution from acquisitions, compared with 300.8 million dozens for the third quarter of FY24. Sales of conventional eggs totaled 213.2 million dozens, compared with 192.2 million dozens for the prior-year period, an increase of 11%. 

Specialty egg volumes also increased by 8.8% to 118.1 million dozens sold for the third quarter of FY25, compared with 108.6 million dozens sold for the prior-year period. Cal-Maine says demand was strong during the third quarter, which is typically a period of higher seasonal demand. The company also points to other factors positively impacting demand, including the historic snowstorms in the southern U.S. in January 2025 and reported recommendations of eggs as a good source of lean protein for individuals taking GLP-1 medications. 

Cal-Maine reports third-quarter farm production costs per dozen were 5.7% lower than the prior-year period, primarily due to more favorable commodity pricing for key feed ingredients. Feed costs per dozen were down 9.6%, compared with the third quarter of FY24. Costs for outside egg purchases increased significantly quarter-over-quarter, primarily due to higher shell egg prices and an increase in dozens of shell eggs purchased to satisfy customer demand while the nation experienced lower overall supply due to HPAI. 

“Our industry has always been prone to volatility due to external factors such as disease outbreaks, fluctuating feed and other production costs and changes in consumer demand,” says Max Bowman, vice president and chief financial officer. “At Cal-Maine Foods, we emphasize the importance of managing the aspects of our business that we can directly impact operationally. During the quarter, our team did an outstanding job with our focused efforts to help mitigate the egg supply constraint and prevent the spread of HPAI to our facilities. All of these underlying activities made a significant contribution to our results for the quarter.”

Cal-Maine says it has recovered from HPAI-related shutdowns at its Kansas and Texas facilities during the third and fourth quarters of FY24. In its FY24 year-end report, the company says it depopulated 3.1 million laying hens and 577,000 pullets.

In its FY25 third-quarter financial report, the company notes the average number of layer hens increased 14% and total chicks hatched during the quarter increased 24%, compared to the prior-year quarter. Additionally, Cal-Maine reports a 33% increase in breeder flocks as of the end of the third quarter, compared to the end of the prior-year quarter.

The company has converted a new egg processing facility and hatchery in Dexter, Missouri, which is projected to add 1.2 million free-range hens by the end of the calendar year.

Cal-Maine also points to continued investment in biosecurity technology, equipment, procedures and training. The company reports it has spent $70 million on measures to address HPAI since 2015.

“Dynamic market conditions and HPAI-related supply shortages persisted this quarter,” says Sherman Miller, Cal-Maine Foods president and CEO. “However, the entire Cal-Maine Foods team did an outstanding job in maximizing production through a period of high demand, while operating safely and maintaining diligence on biosecurity measures. We were fortunate to have the ability to utilize our existing operational scale and to benefit from recent acquisitions, which helped increase our production capacity in this challenging supply environment. Above all, we stayed focused on meeting the needs of our valued customers, while honoring our long-standing pricing frameworks.”

Cal-Maine Foods to Acquire Echo Lake Foods, Inc.

Cal-Maine Foods has agreed to acquire Echo Lake Foods for approximately $258 million, excluding expected tax assets resulting from the transaction, to be funded with available cash on hand. 

Founded in 1941, Echo Lake Foods was acquired by the Meinerz family in 1981. Based in Burlington, Wisconsin, Echo Lake Foods produces, packages, markets and distributes ready-to-eat egg products and breakfast foods, including waffles, pancakes, scrambled eggs, frozen cooked omelets, egg patties, toast and diced eggs. Echo Lake Foods had annual revenues of approximately $240 million in 2024 with a five-year CAGR of approximately 10%. 

The transaction has been approved by both companies’ boards of directors and is expected to close by the end of fiscal 2025, following completion of regulatory approvals and subject to customary closing conditions. 

Echo Lake Foods will operate as a standalone component of Cal-Maine Foods’ integrated operations with four production facilities strategically located across the Midwest. Kathy Brodhagen, current chief executive officer of Echo Lake Foods, will join Cal-Maine Foods’ senior management team as president of Echo Lake Foods 

“This transaction represents an exciting growth opportunity and important inflection point for Cal-Maine Foods, advancing our strategy to expand and diversify our product portfolio and customer mix,” Miller says. “Echo Lake Foods is a leading innovator with a long history of providing quality ready-to-eat egg products and breakfast foods to a blue-chip customer base. The combined product lines and capabilities of the two companies are highly complementary, and importantly, we share similar values of pursuing operating excellence and meeting the needs of our customers. We believe the potential acquisition of Echo Lake Foods meets our disciplined set of investment criteria, including relevant geographic markets, operating synergies, product mix, proximity to customers and expected financial returns.”