It sounds like the exchange consumes bids, not just closed transactions. So these companies were basically publishing fraudulent bids that never completed.

I can’t tell from the article if they were bidding on each others eggs or bidding on other farmers eggs and then canceling.

They buy a relatively small number of eggs at a high price, but the price of the transaction is an input into an index that the larger market uses.

There are a lot of market manipulation techniques that follow this type of pattern. Usually the perpetrator does some combination of

1) Putting in the out of market bid and immediately cancelling so the high bid doesn't get filled. Sometimes they might make this bid in small size so it doesn't matter too much if they do get filled (but this only works if the market is relatively thin or illiquid). Depending on the market, you might be able to put order flags or abuse the matching algorithm to make it less likely to be filled even though your order seems to cross the spread. So for example sometimes people will put in an order, cancel and then place it again so they go to the back of the queue at that level for example.

2) Stuffing the order book lower down with (larger) passive sell orders that will get hit as the market followers start bidding up in anticipation of the price move caused by the very high bid.

I'm not as familiar with the regime in the US markets but in UK/EU markets this behaviour is absolutely market abuse and can result in criminal prosecution and disgorgement of profits.

well if you keep reading, the investigation has concluded and they are declining to pursue any charges, alleging that the return of egg prices to pre-collusion levels is the desired outcome. there may be a $3 million fine, which is of course microscopic compared with the profits created from collusion. surely a years-long price fixing conspiracy costing consumers billions deserves more than that, but under this administration we are unlikely to get it.

Yes, non-binding bids that are not actual sales should not signal anything.

It's a system that is vulnerable to fraud, which is why it's good to have regulators who go after fraudulent actors.

It's a perfectly fine system if the egg producers are using it genuinely, it's only a problem when they start submitting fraudulent bids to accomplish illegal market manipulation.

> This seems like a system tailor-made for collision. It seems like the consumer protection agency should force changes. Too bad they've been made toothless.

Elections have consequences. This is one of them.

I had the same experience on the east coast-- farmers market eggs continued to be $5-$8/doz (depending on size) even as the normal white eggs raced to $10. I think the "conventional wisdom" was that these small farmers weren't hit by the flu in the way that the big industrial farmers were, and that their living conditions made them hardier or less susceptible. I guess I now assume that these small farms relying on direct sales were simply oblivious to the bidding shenanigans.

I'm also in the PNW. The egg thing seemed weird to me when the local organic eggs didn't budge at all. We had bird deaths in the wild from the flu as well, so I know it was out here.

Eggs at my Aldi never went much above $3 a dozen. The cage-free, etc hovered around $6 at the worst (normal is around $3-something)

My friends in the midwest always tell me egg prices have actually never been lower. They've been tracking them for a while now, and they were low during 2014-2020, then had a massive, unexpected jump, then another massive decrease starting 2025. Curious to know what the reasons are here.

Which wouldn’t be that odd if the conspiracy theory was true (since your local farms presumably wouldn’t be invited to the price-fixing meetings).

There is a good story in here about how economics as a profession is intellectually bankrupt. But at the same time, there is also a story about how the only hard data the economics profession can actually offer is actual transactions completed by disinterested, non-colluding, and independent individuals. Supply and demand curves only make sense when there is a genuine conflict between the supply and demand sides. LIBOR-like arrangements, where it's suppliers selling to each other, do not form a valid market because the demand side is also the supply side.

The magic Latin words to ward away CAC farmers[0] are "straight tender-to-tender transaction", aka "you're just moving money around, it's not a real transaction". I am wondering if we need a similar kind of mind-numbing rhetoric to refer to exchanges that are not valid markets: i.e. do not have opposing supply and demand. These exchanges nominally serve some kind of purpose - they balance supply across suppliers - but they should not be allowed to participate in price discovery as they are not a market.

[0] "Customer acquisition costs" refer to any money paid by a business to attract new customers only. A lot of business risk management is put into making sure your customer acquisition costs are not functionally a straight-up discount or giveaway.

I like this part of the article.

> On Wednesday, Hickman saw evidence that Urner Barry was taking in data that would lower prices — “pull the market down,” in the words of one executive — and goaded his erstwhile competitors to respond. “As a group,” the executive followed up, “we need to bid like they vote in Chicago, early and often.”

So while they were actively breaking the law, colluding to screw over the free market, they soothed themselves with jokes about non-existent voter fraud.

The article explains that the federal and state governments did do something about it.

You can buy your eggs from Costco which iirc has their own egg operation these days.

This isn't really something that could be addressed by regulation. It's a natural consequence of capitalism. It's in every industry.

http://concentrationcrisis.openmarketsinstitute.org/

> Bring back Khan.

So she can lose more lawsuits related to her anti-silicon valley obsession? I'd rather get someone who is actually objective and takes a holisitic look at every industry.

Her blinders kept her from focusing on truly monopolies and anti-trust behavior like cable and broadbrand providers, regional hospital systems, etc.

The problem isn’t setting prices in response to market conditions, it’s colluding with other companies to raise prices in unison. That’s what makes something a cartel and that’s what happened here. And I don’t mean raising prices because you saw that someone else did, this was literal phone calls and texts about when prices should go up.

Price collusion does not support efficient markets.

*one shell

Sometimes it all boils down to someone saying "what if" and trying something and seeing if it sticks. I guess the avian flu was a good excuse to hide the crime just like what happens in die hard 3 with the distractions of bomb in schools.

The story covers this. An oligopoly of producers and market makers has formed. Where once there were many small players, now small players are few, and the bulk of egg supply is passing through a few huge producers and brokers.

big fine? they paid 3 million plus 50 million eggs at cost - they probably made on the order of 2-3 billion on this criminal scheme.

I'm confused by your aspersions. should or should not Politico have written this piece? and what is this group of people, and what "approved" outlets do you refer to? are they the ones who naysaid the allegations to begin with or the opposite? have the conviction to name those you accuse.

Google tells me the whistleblower in that case was jailed for massive embezzlement, not for whistleblowing. Do you have reason to think this is false?

> The ADM lysine case years ago also threw a lot of cold water on whistleblowers when the whistleblower ended up getting more jail time than any of the other conspirators.

"Whitacre was sentenced to nine years in federal prison for embezzling $9.5 million from ADM at the same time he was assisting the federal price-fixing investigation."

Not that I trust Wikipedia, but I think if the common narrative is wrong it'd probably behoove you to pre-empt it because anyone who looks it up is going to come away feeling deceived by your statement as written.

There's a 10% chance that eggs will end humanity, so let's just take a breath and slow down all of this talk about eggs.

"Maybe" here is a rhetorical device. We were told by libertarian experts, "there is NO WAY there is collusion. It's bird flu. Duh".

Now, turns out, there was actual price manipulation occurring (Read the article. It's clear what was going on. There were text messages of their criminal conspiracy!) Now the headline is sassily saying "hey, maybe there was price collusion!" This use of "maybe" is a common expression of sarcasm.