Egg Prices May Be Dropping—But Breakfast Chains Are Still Scrambling
A breakfast slowdown isn't unusual in the dead of winter—but this year, it came with a side of economic anxiety and sticker shock. According to new data from Placer.ai, visits to breakfast-first chains slumped throughout January and February, reaching a low of -9.8% year-over-year in mid-February.
One culprit? Eggs. Or, more specifically, their price.
R.J. Hottovy, Head of Analytical Research at Placer.ai, cited inclement weather and broader macroeconomic pressures,but pointed out that breakfast-focused chains 'were hit particularly hard due to egg price surcharges.' As costs climbed and chains passed them on, diners simply backed off.
Diners are pulling back—not just because of prices, but because they're worried about what's next.
Even as prices have started to ease, consumer hesitation lingers. The March Consumer Confidence Index shows that confidence fell for the third month in a row—driven by growing anxiety over job prospects, future income, and persistent inflation. The Expectations Index, which measures short-term outlooks for income, business, and labor markets, dipped to its lowest level since July 2022.
That context matters: even if eggs are cheaper and surcharges are fading, many consumers remain cautious about how they spend—especially on non-essential meals like weekday breakfasts out.
Placer.ai's report tracks a long list of affected brands, from IHOP and Denny's to First Watch and The Original Pancake House. First Watch saw a 10.1% YoY drop in visits during February, while Waffle House—known for its consistent value positioning—weathered the storm slightly better. The message was clear: diners noticed surcharges, and they acted accordingly.
Egg prices may be dropping, but recovery is more than just removing surcharges.
By March, foot traffic had begun to improve. The week of March 17 showed a -2.0% YoY decline, far better than February's lows. Hottovy credits the removal of egg surcharges and easing prices but says macro pressures are still at play.
Meanwhile, operators are doing more than just waiting for costs to come down. According to Technomic's State of the Menu 2025, limited-service chains are growing their core breakfast offerings and rapidly rolling out limited-time offers (LTOs) to stay visible. These efforts aren't just about novelty—they're about value perception.
Consumers don't shop by market report—they shop by what's on the shelf. And that gap is still wide
In my earlier piece, 'Egg Prices Have Dropped Sharply—But There's More to the Story', I reported on the first signs of relief in the egg market. Since then, wholesale prices have fallen even further. According to the USDA, large white shell eggs in the Midwest dropped to $3.87 per dozen by the end of March, while national prices fell to $3.00 per dozen—a 63% drop from February's peak.
Behind the scenes, supply is gradually stabilizing, and processors are keeping pace with demand. Still, that relief hasn't fully reached the checkout line. Retailers remain cautious, waiting to clear out older inventory or to see if prices hold before making major changes to shelf pricing.
At the same time, the Department of Justice has opened an antitrust investigation into whether major egg producers artificially inflated prices during the surge. While still in its early stages, this probe underscores lingering consumer concerns about fairness in the market—a trust issue that breakfast chains may need to address as they rebuild.
Price sensitivity is one piece of the puzzle. Emotional perception—of value, of financial security, of whether things feel 'worth it'—is another. And when consumer confidence is shaky, even a $1 price drop on eggs might not be enough to swing decisions.
CPI data still shows elevated prices for bakery items, coffee and cereal—categories that often accompany eggs on breakfast menus.and the feeling that 'everything costs more now' remains sticky.
Winning back breakfast diners means meeting them where they are—financially and emotionally.
If March's rebound continues into April, it won't just be because ingredient prices fell. It will be because operators read the room: trimming portions without cheapening them, bundling strategically, and offering new items that feel exciting enough to justify the spend.
Value isn't just a number—it's a narrative. And as egg prices shift, breakfast chains that can sell that story of value may find themselves back in consumers' good graces sooner than others.
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