UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION


Washington,
      DC 20549





**FORM
      10-Q**


(mark
      one)





x
            Quarterly
                report pursuant to Section 13 or 15(d) of the Securities Exchange
                Act of
                1934





For
      the
      quarterly period ended December 2, 2006


OR





o
            Transition
                report pursuant to Section 13 or 15(d) of the Securities Exchange
                Act of
                1934





For
      the
      transition period from ____________ to ____________





Commission
      file number: 000-04892





**CAL-MAINE
      FOODS, INC.**


(Exact
      name of registrant as specified in its charter)





**Delaware**
            **64-0500378**(State
                or other Jurisdiction of
            (I.R.S.
                Employer Identification No.)Incorporation
                or Organization)





**3320
      Woodrow Wilson Avenue, Jackson, Mississippi 39209**


(Address
      of principal executive offices)  (Zip
      Code)





**(601)
      948-6813**


(Registrant’s
      telephone number, including area code)





Indicate
      by check mark whether the registrant: (1) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
      the
      preceding 12 months (or for such shorter period that the registrant was required
      to file such reports), and (2) has been subject to such filing requirements
      for
      the past 90 days.


Yes
x  No o





Indicate
      by check mark whether the registrant is a large accelerated filer, an
      accelerated filer, or a non-accelerated filer. See definition of accelerated
      filer and large accelerated filer as defined in Rule 12b-2 of the Exchange
      Act.




Large
                Accelerated filero
            Accelerated
                filerx
            Non-
                Accelerated filero





Indicate
      by check mark whether the registrant is a shell company (as defined in
      Rule 12b-2 of the Exchange Act).


Yes
o No
x








APPLICABLE
      ONLY TO CORPORATE ISSUERS:


Indicate
      number of shares outstanding of each of the issuer’s classes of common stock
      (exclusive of treasury shares), as of December 29, 2006.


Common
                Stock, $0.01 par value
            21,102,891
                sharesClass
                A Common Stock, $0.01 par value
            2,400,000
                shares









**CAL-MAINE
      FOODS, INC. AND SUBSIDIARIES**





**INDEX**




**Page****Part
                  I.        Financial
                  Information**
              ******Number**Item
                  1.
              Financial
                  Statements****Condensed
                  Consolidated Financial Statements (Unaudited)
              3Condensed
                  Consolidated Balance Sheets -December
                  2, 2006 and June 3, 2006
              3Condensed
                  Consolidated Statements of Operations -Thirteen
                  Weeks and Twenty-Six Weeks EndedDecember
                  2, 2006 and November 26, 2005
              4Condensed
                  Consolidated Statements of Cash Flows -Twenty-Six
                  Weeks Ended December 2, 2006 andNovember
                  26, 2005
              5Notes
                  to Condensed Consolidated Financial Statements
              6Item
                  2.
              Management’s
                  Discussion and Analysis ofFinancial
                  Condition and Results of Operations
              9Item
                  3.
              Quantitative
                  and Qualitative Disclosures About Market Risk
              14Item
                  4.
              Controls
                  and Procedures
              15**Part
                  II.        Other
                  Information**Item
                  1.
              Legal
                  Proceedings
              15Item
                  1A.
              Risk
                  Factors
              16Item
                  4.
              Submission
                  of Matters to a Vote of Security Holders
              16Item
                  5.
              Other
                  Information
              16Item
                  6.
              Exhibits
              16Signatures
              
              17




2




**PART
      I. FINANCIAL INFORMATION**


**ITEM
      1. FINANCIAL STATEMENTS**





**CAL-MAINE
      FOODS, INC. AND SUBSIDIARIES**


**CONDENSED
      CONSOLIDATED BALANCE SHEETS**


**(in
      thousands)**




December
                2,
              2006
            
            June
                3,
              2006(unaudited)
            
            (note1)ASSETSCurrent
                assets:Cash
                and cash equivalents
            
            $
            11,364
            
            $
            13,295Investments
            
            
            10,000
            
            
            25,000Trade
                and other receivables
            
            
            43,745
            
            
            24,955Recoverable
                federal income taxes
            
            
            1,086
            
            
            1,177Inventories
            
            
            60,369
            
            
            57,843Prepaid
                expenses and other current assets
            
            
            1,544
            
            
            3,408Total
                current assets
            
            
            128,108
            
            
            125,678Notes
                receivable and investments
            
            
            8,496
            
            
            8,316Goodwill
            
            
            4,016
            
            
            4,016Other
                assets
            
            
            2,652
            
            
            2,833Property,
                plant and equipment
            
            
            346,805
            
            
            339,831Less
                accumulated depreciation
            
            
            (172,271
            )
            
            (163,556
            )174,534
            
            
            176,275TOTAL
                ASSETS
            
            $
            317,806
            
            $
            317,118LIABILITIES
                AND STOCKHOLDERS’ EQUITYCurrent
                liabilities:Accounts
                payable and accrued expenses
            
            $
            44,325
            
            $
            34,642Current
                maturities of purchase obligation
            
            
            5,435
            
            
            6,884Current
                maturities of long-term debt
            
            
            12,930
            
            
            11,902Deferred
                income taxes
            
            
            11,690
            
            
            11,450Total
                current liabilities
            
            
            74,380
            
            
            64,878Long-term
                debt, less current maturities
            
            
            90,650
            
            
            92,010Minority
                interest
            
            
            752
            
            
            919Purchase
                obligation, less current maturities
            
            
            9,479
            
            
            16,751Other
                non-current liabilities
            
            
            3,920
            
            
            3,860Deferred
                income taxes
            
            
            18,355
            
            
            18,925Total
                liabilities
            
            
            197,536
            
            
            197,343Stockholders’
                equity:Common
                stock $0.01 par value per share:Authorized
                shares - 60,000Issued
                35,130 shares and 21,103 shares outstanding at December 2, 2006 and
                June
                3, 2006
            
            
            351
            
            
            351Class
                A common stock $0.01 par value per share, authorized
              issued
                and outstanding 2,400 shares at December 2, 2006 and
              June
                3, 2006
            
            
            24
            
            
            24Paid-in
                capital
            
            
            28,809
            
            
            28,700Retained
                earnings
            
            
            112,569
            
            
            112,183Common
                stock in treasury-14,027 shares at December 2, 2006
              and
                June 3, 2006
            
            
            (21,483
            )
            
            (21,483
            )Total
                stockholders’ equity
            
            
            120,270
            
            
            119,775TOTAL
                LIABILITIES AND STOCKHOLDERS’ EQUITY
            
            $
            317,806
            
            $
            317,118





See
      notes
      to condensed consolidated financial statements.





3




**CAL-MAINE
      FOODS, INC. AND SUBSIDIARIES**


**CONDENSED
      CONSOLIDATED STATEMENTS OF OPERATIONS**


**(in
      thousands, except per share amounts)**


**(unaudited)**





13
                Weeks Ended
            
            26
                Weeks EndedDecember
                2, 2006
            
            November
                26, 2005
            
            December
                2, 2006
            
            November
                26, 2005Net
                sales
            
            $
            137,737
            
            $
            138,288
            
            $
            253,045
            
            $
            218,043Cost
                of sales
            
            
            112,782
            
            
            120,479
            
            
            219,683
            
            
            199,274Gross
                profit
            
            
            24,955
            
            
            17,809
            
            
            33,362
            
            
            18,769Selling,
                general andadministrative
            
            
            14,458
            
            
            16,729
            
            
            28,928
            
            
            27,647Operating
                income (loss)
            
            
            10,497
            
            
            1,080
            
            
            4,434
            
            
            (8,878
            )Other
                income (expense):Interest
                expense, net
            
            
            (1,764
            )
            
            (2,294
            )
            
            (3,559
            )
            
            (3,989
            )Other
            
            
            824
            
            
            192
            
            
            681
            
            
            (256
            )(940
            )
            
            (2,102
            )
            
            (2,878
            )
            
            (4,245
            )Income
                (loss) before incometaxes
            
            
            9,557
            
            
            (1,022
            )
            
            1,556
            
            
            (13,123
            )Income
                tax expense (benefit)
            
            
            3,156
            
            
            (337
            )
            
            586
            
            
            (4,330
            )Net
                income (loss)
            
            $
            6,401
            
            $
            (685
            )
            $
            970
            
            $
            (8,793
            )Net
                income (loss) per commonshare:Basic
            
            $
            0.27
            
            $
            (0.03
            )
            $
            0.04
            
            $
            (0.37
            )Diluted
            
            $
            0.27
            
            $
            (0.03
            )
            $
            0.04
            
            $
            (0.37
            )Dividends
                per common share
            
            $
            .0125
            
            $
            .0125
            
            $
            .0250
            
            $
            .0250Weighted
                average sharesoutstanding:Basic
            
            
            23,503
            
            
            23,495
            
            
            23,503
            
            
            23,492Diluted
            
            
            23,597
            
            
            23,495
            
            
            23,596
            
            
            23,492




See
      notes
      to condensed consolidated financial statements.




4




**CAL-MAINE
      FOODS, INC. AND SUBSIDIARIES**


**CONDENSED
      CONSOLIDATED STATEMENTS OF CASH FLOWS**


**(in
      thousands)**


**(unaudited)**





26
                Weeks EndedDecember
                2, 2006
            
            November
                26, 2005Cash
                provided by (used in) operations
            
            $
            2,345
            
            $
            (12,668
            )Investing
                activities:Sales
                of short-term investments
            
            
            15,000
            
            
            26,384Acquisition
                of businesses, net of cash acquired
            
            
            -
            
            
            (23,804
            )Purchases
                of property, plant and equipment
            
            
            (12,065
            )
            
            (2,838
            )Payments
                received on notes receivable and from investments
            
            
            560
            
            
            1,433Increase
                in notes receivable and investments
            
            
            (1,030
            )
            
            (519
            )Net
                proceeds from disposal of property, plant and equipment
            
            
            277
            
            
            1,568Net
                cash provided by investing activities
            
            
            2,742
            
            
            2,224Financing
                activities:
              Payment
                of purchase obligation
            
            
            (6,102
            )
            
            -Proceeds
                from issuance of common stock from treasury
            
            
            -
            
            
            46Proceeds
                from long-term borrowings
            
            
            3,000
            
            
            28,000Principal
                payments on long-term debt
            
            
            (3,331
            )
            
            (24,283
            )Payments
                of dividends
            
            
            (585
            )
            
            (584
            )Net
                cash provided by (used in) financing activities
            
            
            (7,018
            )
            
            3,179Net
                change in cash and cash equivalents
            
            
            (1,931
            )
            
            (7,265
            )Cash
                and cash equivalents at beginning of period
            
            
            13,295
            
            
            20,221Cash
                and cash equivalents at end of period
            
            $
            11,364
            
            $
            12,956





See
      notes
      to condensed consolidated financial statements.




5





**CAL-MAINE
      FOODS, INC. AND SUBSIDIARIES**


Notes
      to
      Condensed Consolidated Financial Statements


(in
      thousands, except share amounts)


December
      2, 2006


(unaudited)




1.  Presentation
      of Interim Information





The
      accompanying unaudited condensed consolidated financial statements have been
      prepared in accordance with generally accepted accounting principles for interim
      financial information and with the instructions to Form 10-Q and Article 10
      of
      Regulation S-X. Accordingly, they do not include all of the information and
      footnotes required by generally accepted accounting principles for complete
      financial statements. In the opinion of management, all adjustments, consisting
      of normal recurring adjustments, considered necessary for a fair presentation
      have been included. Operating results for the three-month and six-month periods
      ended December 2, 2006 are not necessarily indicative of the results that may
      be
      expected for the year ending June 2, 2007.





The
      balance sheet at June 3, 2006 has been derived from the audited financial
      statements at that date but does not include all of the information and
      footnotes required by generally accepted accounting principles for complete
      financial statements.




For
      further information, refer to the consolidated financial statements and
      footnotes thereto included in Cal-Maine Foods, Inc.'s annual report on Form
      10-K
      for the fiscal year ended June 3, 2006.




**Hillandale
      Acquisition**





On
      July
      28, 2005, we entered into an Agreement to Form a Limited Liability Company
      with
      Hillandale Farms, Inc. and Hillandale Farms of Florida, Inc. (together,
“Hillandale”), and the Hillandale shareholders (the “Agreement”). Under the
      terms of the Agreement, we acquired 51% of the Units of Membership in
      Hillandale, LLC, formed under the Agreement, for cash of approximately $27
      million on October 12, 2005, with the remaining 49% of the Units of Membership
      to be acquired in essentially equal annual installments over a four-year period.
      The purchase price of the Units equals their book value at the time of purchase
      as calculated under the terms of the Agreement.





In
      August
      2006, in
      accordance with the Agreement, we
      purchased, for $6.1 million, an additional 13% of the Units of Hillandale,
      LLC
      based on their book value as of July 29, 2006. Our ownership of Hillandale,
      LLC
      currently is 64%. Our obligation to acquire the remaining 36% of Hillandale,
      LLC
      is recorded at its present value of $14.9 million as of December 2, 2006, of
      which $5.4 million is included in current liabilities and $9.5 million is
      included in other non-current liabilities in the accompanying consolidated
      balance sheet. We will purchase an additional 12% of Hillandale LLC based on
      the
      book value of the Membership Units as of July 29, 2007.





Prior
      to
      the acquisition of our Units of Membership in Hillandale, LLC, we had a 44%
      membership interest in American Egg Products, LLC (“AEP”) and Hillandale, LLC
      had a 27.5% membership interest in AEP. Prior to the acquisition of Hillandale,
      LLC, our membership interest in AEP was accounted for by the equity method.
      Effective with our acquisition of Hillandale, LLC, we own a majority of the
      membership interests in AEP. Accordingly, the financial statements of AEP have
      been consolidated with our financial statements effective July 29,
      2005.





We
      gained
      effective control of the Hillandale, LLC operations upon signing of the
      Agreement. Accordingly, the acquisition date for accounting purposes was July
      28, 2005. The operations of Hillandale, LLC were consolidated with our
      operations beginning July 29, 2005. Because all of the information to close
      the
      accounting records of Hillandale, LLC was not available at August 27, 2005,
      we
      did not include the financial statements of Hillandale, LLC in our consolidated
      financial statements until the second fiscal quarter of 2006.




The
      unaudited financial information in the table below summarizes the combined
      results of our operations and Hillandale, LLC, on a pro forma basis, as though
      we had been combined as of the beginning of the earliest period presented.
      The
      pro forma financial information is presented for informational purposes only
      and
      is not indicative of the results of operations that would have been achieved
      if
      the acquisition had taken place at the beginning of the earliest period
      presented.




6




26
                Weeks EndedDecember
                2,
              2006
            
            November
                26,
              2005Net
                sales
            
            $
            253,045
            
            $
            231,017Net
                income (loss)
            
            $
            970
            
            $
            (12,949
            )Basic
                net income (loss) per share
            
            $
            0.04
            
            $
            (0.55
            )Diluted
                net income (loss) per share
            
            $
            0.04
            
            $
            (0.55
            )




**Stock
      Based Compensation**





In
      December 2004, the Financial Accounting Standards Board (“FASB”) issued
      Statement of Financial Accounting Standards (“SFAS”) Statement No. 123
      (revised 2004) (“SFAS No.123(R)”), "Share-Based Payment," which is a revision of
      SFAS No. 123, "Accounting for Stock-Based Compensation." SFAS
      No. 123(R) supersedes Accounting Principles Board (“APB”) Opinion
      No. 25, "Accounting for Stock Issued to Employees", and amends SFAS
      No. 95, "Statement of Cash Flows". SFAS No. 123(R) requires all
      share-based payments to employees, including grants of employee stock options,
      restricted stock and performance-based shares to be recognized in the income
      statement based on their fair values. SFAS No. 123(R) also requires the
      benefits of tax deductions in excess of recognized compensation cost to be
      reported as a financing cash flow, rather than as an operating cash flow as
      required under current literature. This requirement will reduce net operating
      cash flows and increase net financing cash flows in periods after adoption.
      In
      the first quarter of fiscal 2007, we adopted SFAS No. 123(R) using the
      modified prospective method. Under the modified prospective method, compensation
      cost will be recognized for all share-based payments granted after the adoption
      of SFAS No. 123(R) and for all awards granted to employees prior to the
      adoption date of SFAS No. 123R that remain unvested on the adoption date.
      Accordingly, no restatements were made to prior periods. We recognized stock
      based compensation expense of $93 and $253 for the thirteen week and twenty-six
      week periods ended December 2, 2006.





Prior
      to
      adoption of SFAS No. 123(R), we applied Accounting Principles Board (“APB”) No.
      25 in accounting for our employee stock compensation plans and generally
      recognized no compensation expense for employee stock options. Under the
      provisions of APB No. 25, we recognized a liability for Stock Appreciation
      Rights (“SARS”) and Tandem Stock Appreciation Rights (“TSARS”) (collectively,
“Rights”) based upon the intrinsic value of vested SARS and TSARS at each period
      end. Under SFAS No. 123(R), we are required to recognize a liability for vested
      SARS and TSARS based upon their fair value at each period end using a
      Black-Scholes option pricing model and to record a cumulative effect adjustment
      for the change in method of accounting for such liability awards. The cumulative
      effect resulting from the adoption of SFAS No. 123(R) was insignificant and
      is
      included in stock based compensation expense for the current fiscal year.





Our
      stock-based compensation plans are described in note 1 of the notes to
      consolidated financial statements included in our Annual Report on Form 10-K
      for
      the fiscal year ended June 3, 2006. On August 24, 2006, in accordance with
      provisions of our 2005 Stock Appreciation Rights Plan (the “SARs Plan”), our
      Board of Directors approved an amendment to the SARs Plan providing that
      exercises under the SARs Plan be settled in cash and not with shares of our
      common stock.





A
      summary
      of our equity award activity and related information for the twenty-six weeks
      ended December 2, 2006 is as follows:




Number
            
            Weighted
            
            WeightedAverageRemaining
            
            Aggregateof
            
            Exercise
                Price
            
            Contractual
            
            IntrinsicOptions
            
            Per
                Share
            
            Life
                (in Years)
            
            ValueOutstanding,
                June 3, 2006
            
            
            473,400
            
            $
            4.97Granted
            
            
            -
            
            
            -Exercised
            
            
            -
            
            
            -Forfeited
            
            
            -
            
            
            -Outstanding,
                December 2, 2006
            
            
            473,400
            
            $
            4.97
            
            
            7.84
            
            $
            1,415Exercisable,
                December 2, 2006
            
            
            159,840
            
            $
            3.71
            
            
            6.71
            
            $
            680





7




The
      number and weighted average grant-date fair value of non-vested equity awards
      was as follows:





WeightedNumber
            
            Averageof
            
            Grant-Date
                FairShares
            
            Value
                Per ShareNonvested,
                June 3, 2006
            
            
            395,760
            
            $
            2.56Granted
            
            
            -
            
            
            -Vested
            
            
            (82,200
            )
            
            2.52Forfeited
            
            
            -
            
            
            -Nonvested,
                December 2, 2006
            
            
            313,560
            
            $
            2.58





A
      summary
      of our liability award activity and related information for the twenty-six
      weeks
      ended December 2, 2006 is as follows:





WeightedWeighted
            
            AverageNumber
            
            Average
            
            Remaining
            
            AggregateOf
            
            Strike
                Price
            
            Contractual
            
            IntrinsicRights
            
            Per
                Right
            
            Life
                (in Years)
            
            ValueOutstanding,
                June 3, 2006
            
            
            586,000
            
            $
            5.69Granted
            
            
            15,000
            
            $
            6.93Exercised
            
            
            4,500
            
            $
            8.29Forfeited
            
            
            -Outstanding,
                December 2, 2006
            
            
            596,500
            
            $
            5.72
            
            
            8.44
            
            $
            1,336Exercisable,
                December 2, 2006
            
            
            143,300
            
            $
            4.93
            
            
            7.54
            
            $
            435





The
      fair
      value of liability awards was estimated as of December 2, 2006 using a
      Black-Scholes option pricing model using the following weighted-average
      assumptions: risk-free interest rate of 4.4%; dividend yield of 1%; volatility
      factor of the expected market price of our stock of 27.9%; and a
      weighted-average expected life of the rights of 5 years.





2.
      Inventories





Inventories
      consisted of the following ( in thousands):





December
                2,
              2006
            
            June
                3,
              2006Flocks
            
            $
            38,144
            
            $
            39,092Eggs
            
            
            5,637
            
            
            3,820Feed
                and supplies
            
            
            16,588
            
            
            14,931$
            60,369
            
            $
            57,843





8




3.
Legal
        Proceedings




We
      are
      defendants in certain legal actions. It is our opinion, based on advice of
      legal
      counsel, that the outcome of these actions will not have a material adverse
      effect on our consolidated financial position or operations. Please refer to
      Part II, Item 1, of this report for a description of certain pending legal
      proceedings.




4.
      Net
      Income (Loss) per Common Share





Basic
      income (loss) per share is based on the weighted average common shares
      outstanding. Diluted income (loss) per share includes any dilutive effects
      of
      options and warrants. Options and warrants representing 121,400 shares were
      excluded from the calculation of diluted earnings per share for the thirteen
      and
      twenty-six week periods ended November 26, 2005 because of the net loss for
      the
      periods.




**ITEM
      2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL** **CONDITION
      AND RESULTS OF OPERATIONS**





This
      report contains numerous forward-looking statements relating to our shell egg
      business, including estimated production data, expected operating schedules,
      expected capital costs and other operating data. Such forward-looking statements
      are identified by the use of words such as "believes," "intends," "expects,"
      "hopes," "may," "should," "plan," "projected," "contemplates," "anticipates"
      or
      similar words. Actual production, operating schedules, results of operations
      and
      other projections and estimates could differ materially from those projected
      in
      the forward-looking statements. The factors that could cause actual results
      to
      differ materially from those projected in the forward-looking statements include
      (i) the risk factors set forth under Item 1A of our Annual Report on Form 10-K
      for the fiscal year ended June 3, 2006, (ii) the risks and hazards inherent
      in
      the shell egg business (including disease, pests, and weather conditions),
      (iii)
      changes in the market prices of shell eggs, and (iv) changes or obligations
      that
      could result from our future acquisition of new flocks or businesses. Readers
      are cautioned not to put undue reliance on forward-looking statements. We
      disclaim any intent or obligation to update publicly these forward-looking
      statements, whether as a result of new information, future events or otherwise.





OVERVIEW





Cal-Maine
      Foods, Inc. (“we”, “us”, “our”, or the “Company”) is primarily engaged in the
      production, grading, packaging, marketing and distribution of fresh shell eggs.
      Our fiscal year end is the Saturday closest to May 31.





Our
      operations are fully integrated. At our facilities we hatch chicks, grow and
      maintain flocks of pullets (young female chickens, usually under 20 weeks of
      age), layers (mature female chickens) and breeders (male or female birds used
      to
      produce fertile eggs to be hatched for egg production flocks), manufacture
      feed,
      and produce, process and distribute shell eggs. We are the largest producer
      and
      marketer of shell eggs in the United States. We market the majority of our
      shell
      eggs in 30 states, primarily in the southwestern, southeastern, mid-western
      and
      mid-Atlantic regions of the United States. We market our shell eggs through
      our
      extensive distribution network to a diverse group of customers, including
      national and regional grocery store chains, club stores, foodservice
      distributors and egg product manufacturers.





We
      currently produce approximately 75% of the total number of shell eggs sold
      by
      us, with approximately 10% of such total shell egg production being through
      the
      use of contract producers. Contract producers operate under agreements with
      us
      for the use of their facilities in the production of shell eggs by layers owned
      by us. We own the shell eggs produced under these arrangements. Approximately
      25% of the total number of shell eggs sold by us is purchased from outside
      producers for resale, as needed, by us.




Our
      operating income or loss is significantly affected by wholesale shell egg market
      prices, which can fluctuate widely and are outside of our control. Retail sales
      of shell eggs are generally greatest during the fall and winter months and
      lowest during the summer months. Prices for shell eggs fluctuate in response
      to
      seasonal factors and a natural increase in egg production during the spring
      and
      early summer.




9




Our
      cost
      of production is materially affected by feed costs, which average about 55%
      of
      our total shell egg farm production cost. Changes in feed costs result in
      changes in cost of goods sold. The cost of feed ingredients is affected by
      a
      number of supply and demand factors such as crop production and weather, and
      other factors, such as the level of grain exports, over which we have little
      or
      no control.




The
      acquisition of Hillandale, LLC and the financial consolidation of American
      Egg
      Products, LLC described above in Item 1 are collectively referred to below
      as
      the “Acquisitions".





RESULTS
      OF OPERATIONS





The
      following table sets forth, for the periods indicated, certain items from our
      Condensed Consolidated Statements of Operations expressed as a percentage of
      net
      sales.








Percentage
                of Net Sales13
                Weeks Ended
            
            26
                Weeks EndedDec.
                2, 2006
            
            Nov.
                26, 2005
            
            Dec.
                2, 2006
            
            Nov.
                26, 2005Net
                sales
            
            
            100.0
            %
            
            100.0
            %
            
            100.0
            %
            
            100.0
            %Cost
                of sales
            
            
            81.9
            
            
            87.1
            
            
            86.8
            
            
            91.4Gross
                profit
            
            
            18.1
            
            
            12.9
            
            
            13.2
            
            
            8.6Selling,
                general & administrative expense
            
            
            10.5
            
            
            12.1
            
            
            11.4
            
            
            12.7Operating
                income (loss)
            
            
            7.6
            
            
            .8
            
            
            1.8
            
            
            (4.1
            )Other
                expense
            
            
            (.7
            )
            
            (1.5
            )
            
            (1.2
            )
            
            (1.9
            )Income
                (loss) before taxes
            
            
            6.9
            
            
            (.7
            )
            
            .6
            
            
            (6.0
            )Income
                tax (benefit)
            
            
            2.3
            
            
            (.2
            )
            
            .2
            
            
            (2.0
            )Net
                income (loss)
            
            
            4.6
            %
            
            (.5
            )%
            
            .4
            %
            
            (4.0
            )%







NET
      SALES




Currently,
      approximately 96% of our net sales consist of shell egg sales, 2% consisting
      of
      incidental feed sales to outside producers, with the remaining 2% balance
      consisting of sales of egg products. Net sales for the second quarter of fiscal
      2007 were $137.7 million, a decrease of $600,000, or .5%, compared to net sales
      of $138.3 million for the second quarter of fiscal 2006. Total dozens of eggs
      sold decreased and egg selling prices increased in the current quarter as
      compared with fiscal 2006. Dozens sold for the current quarter were 172.1
      million dozen, a decrease of 16.8 million dozen, or 8.9% as compared to the
      second quarter of fiscal 2006.The decrease in dozens sold is primarily
      attributable to 17 weeks of operations of the Acquisitions included in the
      quarter ended November 26, 2005 compared to 13 weeks of operations in the
      current quarter. The operations of the Acquisitions were consolidated with
      our
      operations beginning July 29, 2005. Because all of the information to close
      the
      accounting records of the Acquisitions was not available, we did not include
      the
      financial statements of Hillandale, LLC in our consolidated financial statements
      until the second fiscal quarter of 2006. In the current quarter, domestic demand
      for shell eggs improved ****** as
      compared to a year ago, and overall egg production was approximately level
      as
      compared to a year ago. This resulted in higher shell egg selling prices during
      the current quarter. Our net average selling price per dozen for the fiscal
      2007
      second quarter was $.765, compared to $.643 for the second quarter of fiscal
      2006, an increase of 19.0%.  The
      net
      average selling price is the blended price for all sizes and grades of shell
      eggs, including non-graded egg sales, breaking stock and
      undergrades.




Net
      sales
      for the twenty-six week period ended December 2, 2006 were $253.0 million,
      an
      increase of $35.0 million, or 16.1%, compared to net sales of $218.0 million
      for
      the fiscal 2006 twenty-six week period. Dozens sold for the current twenty-six
      week period were 344.4 million compared to 324.4 million for fiscal 2006, an
      increase of 20.0 million dozen, or 6.2%. The increase in dozens sold is
      primarily due to the Acquisitions in the prior fiscal year. As in the current
      quarter, favorable egg market conditions resulted in increased shell egg selling
      prices. For the fiscal 2007 twenty-six week period, our net average selling
      price per dozen was $.698, compared to $.607 per dozen for fiscal 2006, an
      increase of $.091 per dozen, or 15.0%.




10




COST
      OF
      SALES





Cost
      of
      sales consists of costs directly related to production and processing of shell
      eggs, including feed costs, and purchases of shell eggs from outside egg
      producers. Total cost of sales for the second quarter ended December 2, 2006
      was
      $112.8 million, a decrease of $7.7 million, or 6.4%, as compared to the cost
      of
      sales of $120.5 million for the fiscal 2006 second quarter. This decrease is
      the
      net result of a decrease in dozens sold, offset by the higher cost of feed
      ingredients and cost of shell eggs purchased from outside producers. Due to
      the
      increase in shell egg selling prices, outside egg purchase cost increased.
      Feed
      cost for the second quarter ended December 2, 2006 was $.229 per dozen, an
      increase of 11.2%, as compared to the fiscal 2006 second quarter cost per dozen
      of $.206. Other operating costs have increased slightly above last fiscal year.
      Increases in shell egg selling prices offset an increase in feed ingredients
      and
      resulted in a net increase in gross profit from 12.9% of net sales for the
      quarter ended November 26, 2005 to 18.1% of net sales the quarter ended December
      2, 2006.





For
      the
      twenty-six week period ended December 2, 2006, total cost of sales was $219.7
      million, an increase of $20.4 million, or 10.2%, as compared to cost of sales
      of
      $199.3 million for the twenty-six week period ended November 26, 2005. The
      increase in cost of sales is the result of increased dozens sold, higher cost
      of
      eggs purchased from outside producers and an increase in the cost of feed
      ingredients. Feed cost for the current twenty-six weeks was $.222 per dozen,
      compared to $.212 per dozen for the twenty-six week period ended November 26,
      2005, an increase of 4.7%. Gross profit increased to 13.2% of net sales for
      the
      twenty-six week period ended December 2, 2006 from 8.6% for the comparable
      twenty-six week period ended November 26, 2005.




SELLING,
      GENERAL AND ADMINISTRATIVE EXPENSES





Selling,
      general and administrative expenses include costs of marketing, distribution,
      accounting and corporate overhead. Selling, general and administrative expense
      for the second quarter ended December 2, 2006 was $14.5 million, a decrease
      of
      $2.2 million, or 13.2%, as compared to $16.7 million for the quarter ended
      November 26, 2005. The decrease is primarily attributable to a decrease in
      selling, general and administrative expenses of the Acquisitions attributable
      to
      the 17 weeks of operations of the Acquisitions included in the prior second
      quarter On a cost per dozen sold basis, selling, general and administrative
      expense was $.084 per dozen for the current quarter as compared to $.088 for
      the
      second quarter of fiscal 2006. As a percent of net sales, selling, general
      and
      administrative expense decreased from 12.1% for the second quarter of fiscal
      2006 to 10.5% for the second quarter of fiscal 2007.





For
      the
      twenty-six weeks ended December 2, 2006, selling, general and administrative
      expense was $28.9 million, an increase of $1.3 million, or 4.7%, as compared
      to
      $27.6 million for the same period in fiscal 2006. In the twenty-six weeks ended
      December 2, 2006, franchise fees and promotional expenses pertaining to our
      increasing specialty egg business increased almost $1.0 million. In the fiscal
      2006 period, approximately $400,000 was recovered in bad debts. Fuel expense
      continues to be a major distribution cost increase. On a cost per dozen sold
      basis, selling, general and administrative expense was $.084 for the current
      twenty-six weeks as compared to $.085 for the comparable period last fiscal
      year. As a percent of net sales, selling, general and administrative expense
      decreased from 12.7% for the twenty-six weeks of fiscal 2006 to 11.4% for the
      current comparable period in fiscal 2007.




OPERATING
      INCOME (LOSS)





As
      the
      result of the above, operating income was $10.5 million for the second quarter
      ended December 2, 2006, as compared to operating income of $1.1 million for
      the
      second quarter of fiscal 2006. As a percent of net sales, the current fiscal
      2007 quarter had a 7.6% operating income, compared to 0.8% for the comparable
      period in fiscal 2006.




11




For
      the
      twenty-six weeks ended December 2, 2006, operating income was $4.4 million,
      compared to operating loss of $8.9 million for the comparable period in fiscal
      2006. As a percent of net sales, the current fiscal 2007 period had 1.8%
      operating income, compared to 4.1% operating loss for the same period in fiscal
      2006.




OTHER
      INCOME (EXPENSE)




Other
      income or expense consists of costs or income not directly charged to, or
      related to, operations such as interest expense and equity in income from
      affiliates. Other expense for the second quarter ended December 2, 2006 was
      $940,000, a decrease of $1.2 million, as compared to $2.1 million for last
      year’s second quarter. This net decrease for the second fiscal 2007 quarter was
      primarily the result of a $530,000 decrease in net interest expense and a
      $632,000 increase in other income. Net interest decreased due to lower long-term
      borrowing balances. Other income increased due to equity in income of
      affiliates. As a percent of net sales, other expense was .7% for the twenty-six
      weeks ended December 2, 2006, compared to 1.5% for the comparable period last
      year.





For
      the
      twenty-six weeks ended December 2, 2006, other expense was $2.9 million, a
      decrease of $1.4 million as compared to an expense of $4.2 million for the
      comparable period in fiscal 2006. For the current fiscal 2007 period, net
      interest expense decreased $431,000, primarily due to lower borrowing balances
      and an increase in interest income. Other income increased $840,000 from equity
      in income of affiliates. As a percent of net sales, other expense was 1.2%
      for
      the current fiscal 2007 period, as compared to 1.9% for the comparable period
      in
      fiscal 2006.





INCOME
      TAXES





As
      a
      result of the above, the pre-tax income was $9.6 million for the quarter ended
      December 2, 2006, compared to pre-tax loss of $1.0 million for last year’s
      comparable quarter. For the second 2007 fiscal quarter, income tax expense
      of
      $3.2 million was recorded with an effective tax rate of 33.0%, as compared
      to an
      income tax benefit of $337,000 with an effective rate of 33.0% for last year’s
      comparable quarter.





For
      the
      twenty-six week period ended December 2, 2006, pre-tax income was $1.6 million,
      compared to pre-tax loss of $13.1 million for the comparable period in fiscal
      2006. For the current fiscal 2007 twenty-six week period, income tax expense
      of
      $586,000 was recorded with an effective tax rate of 37.7%, as compared to an
      income tax benefit of $4.3 million, with an effective rate of 33.0% for last
      year’s comparable period. Our effective tax rate differs from the federal
      statutory income tax rate of 35% due to state income taxes and certain items
      included in income for financial reporting purposes that are not included in
      taxable income or loss for income tax purposes, including tax exempt interest
      income, certain stock option expense and 36% of the Acquisitions’ profits and
      losses held by its minority owners.




NET
      INCOME (LOSS)





Net
      income for the second quarter ended December 2, 2006 was $6.4 million, or $0.27
      per basic and diluted share, compared to net loss of $685,000 million, or $0.03
      per basic and diluted share for fiscal 2006.





For
      the
      twenty-six week period ended December 2, 2006, net income was $970,000, or
      $0.04
      per basic and diluted share, compared to a fiscal 2006 net loss of $8.8 million,
      or $0.37 per basic share and diluted share.




CAPITAL
      RESOURCES AND LIQUIDITY





Our
      working capital at December 2, 2006 was $53.7 million compared to $60.8 million
      at June 3, 2006. Our current ratio was 1.72 at December 2, 2006 as compared
      with
      1.94 at June 3, 2006. Our need for working capital generally is highest in
      the
      last and first fiscal quarters ending in May and August, respectively, when
      egg
      prices are normally at seasonal lows. Seasonal borrowing needs frequently are
      higher during these quarters than during other fiscal quarters. We have a $40.0
      million line of credit with three banks, $2.7 million of which was utilized
      for
      a standby letter of credit at December 2, 2006. Our long-term debt at December
      2, 2006, including current maturities, amounted to $103.6 million, as compared
      to $103.9 million at June 3, 2006.




12




For
      the
      twenty-six weeks ended December 2, 2006, $2.3 million in net cash was provided
      by operating activities. This compares to net cash used in operating activities
      of $12.7 million for the 26 weeks ended November 26, 2005. For the twenty-six
      weeks ended December 2, 2006, $15.0 million was provided from the reduction
      of
      short-term investments and $470,000 was used for notes receivable and
      investments. Approximately $277,000 was provided from disposal of property,
      plant and equipment, $12.1 million was used for purchases of property, plant
      and
      equipment and $6.1 million was used for payment on the purchase obligation
      for
      the Acquisitions. Borrowings of $3.0 million were received in additional
      long-term debt and approximately $585,000 was used for payments of dividends
      on
      the common stock and $3.3 million was used for principal payments on long-term
      debt. The net result of these activities was a decrease in cash and cash
      equivalents of $1.9 million since June 3, 2006.





For
      the
      twenty-six weeks ended November 26, 2005, approximately $26.4 million was
      provided from the reduction of short-term investments and $914,000 was provided
      from notes receivable and investments. Approximately $1.5 million was provided
      from disposal of property, plant and equipment, $2.8 million was used for
      purchases of property, plant and equipment and $23.8 million was used for the
      purchase of the Acquisitions. Borrowings of $28.0 million were received in
      additional long-term debt and approximately $584,000 was used for payments
      of
      dividends on the common stock and $24.2 million was used for principal payments
      on long-term debt. The net result of these activities was a decrease in cash
      and
      cash equivalents of $7.3 million since May 28, 2005.




Substantially
      all trade receivables and inventories collateralize our revolving line of credit
      and property, plant and equipment collateralize our long-term debt under our
      loan agreements with our lenders. Unless otherwise approved by our lenders,
      we
      are required by provisions of these loan agreements to (1) maintain minimum
      levels of working capital (ratio of not less than 1.25 to 1) and net worth
      (minimum of $90.0 million tangible net worth); (2) limit dividends to an
      aggregate amount not to exceed $500,000 per quarter (allowed if no default),
      capital expenditures (not to exceed depreciation for the same four fiscal
      quarters), lease obligations and additional long-term borrowings (total funded
      debt to total capitalization not to exceed 55%); and (3) maintain various
      cash-flow coverage ratios (1.25 to 1), among other restrictions. At December
      2,
      2006, we were in compliance with the provisions of all loan agreements. Under
      certain of the loan agreements, the lenders have the option to require the
      prepayment of any outstanding borrowings in the event we undergo a change in
      control.





Under
      the
      terms of our Agreement with Hillandale and the Hillandale shareholders, a new
      Florida limited liability company named Hillandale, LLC was formed. In fiscal
      2006, we purchased 51% of the Units of Membership in Hillandale, LLC, with
      the
      remaining Units to be acquired in essentially equal annual installments over
      a
      four-year period. The purchase price of the Units is equal to their book value
      as calculated in accordance with the terms of the Agreement. In fiscal 2007,
      we
      purchased, pursuant to the Agreement, an additional 13% of the Units of
      Membership for $6.1 million from our cash balances. We have recorded the
      obligation to acquire the remaining 36% at its present value of $14.9 million.
      The actual remaining purchase price may be higher or lower when the acquisitions
      are completed. Future funding is expected to be provided by our cash balances
      and borrowings under our revolving credit agreement.




We
      currently have a $1.9 million deferred tax liability due to a subsidiary's
      change from a cash basis to an accrual basis taxpayer on May 29, 1988. The
      Taxpayer Relief Act of 1997 provides that this liability is payable ratably
      over
      the 20 years beginning in fiscal 1999. However, such taxes will be due in their
      entirety in the first fiscal year in which there is a change in ownership
      control so that we no longer qualify as a "family farming corporation." We
      are
      currently making annual payments of approximately $150,000 related to this
      liability. However, while these current payments reduce cash balances, payment
      of the $1.9 million deferred tax liability would not impact our consolidated
      statement of operations or stockholders' equity, as these taxes have been
      accrued and are reflected on our consolidated balance sheet.




***Impact
      of Recently Issued Accounting Standards.***




In
      November 2004, the FASB issued Statement of Financial Accounting
      Standards (SFAS) No. 151, “Inventory Costs, an amendment of ARB
      No. 43, Chapter 4.” SFAS No. 151 amends Accounting Research
      Bulletin No. 43, Chapter 4, to clarify that abnormal amounts of idle
      facility expense, freight handling costs and wasted materials (spoilage) should
      be recognized as current-period charges. In addition, SFAS No. 151 requires
      that allocation of fixed production overhead to inventory be based on the normal
      capacity of the production facilities during fiscal years beginning after
      June 15, 2005. We adopted SFAS No. 151 in the first quarter of
      fiscal 2007 and
      it  did
      not
      have a significant impact on our results of operations, financial position
      or
      cash flows.




13




In
      December 2004, the FASB issued SFAS Statement No. 123 (revised 2004),
      "Share-Based Payment," which is a revision of SFAS No. 123, "Accounting for
      Stock-Based Compensation." SFAS No. 123(R) supersedes APB Opinion
      No. 25, "Accounting for Stock Issued to Employees", and amends SFAS
      No. 95, "Statement of Cash Flows". SFAS No. 123(R) requires all
      share-based payments to employees, including grants of employee stock options,
      restricted stock and performance-based shares to be recognized in the income
      statement based on their fair values. SFAS No. 123(R) also requires the
      benefits of tax deductions in excess of recognized compensation cost to be
      reported as a financing cash flow, rather than as an operating cash flow as
      required under current literature. This requirement will reduce net operating
      cash flows and increase net financing cash flows in periods after adoption.
      In
      the first quarter of fiscal 2007, we adopted SFAS No. 123(R) using the
      modified prospective method. Under the modified prospective method, compensation
      cost will be recognized for all share-based payments granted after the adoption
      of SFAS No. 123(R) and for all awards granted to employees prior to the
      adoption date of SFAS No. 123R that remain unvested on the adoption date.
      Accordingly, no restatements were made to prior periods.





Prior
      to
      adoption of SFAS No. 123(R), we applied APB No. 25 in accounting for our
      employee stock compensation plans and generally recognized no compensation
      expense for employee stock options. Under the provisions of APB No. 25, we
      recognized a liability for Stock Appreciation Rights (“SARS”) and Tandem Stock
      Appreciation Rights (“TSARS”) based upon the intrinsic value of vested SARS and
      TSARS at each period end. Under SFAS No. 123(R), we are required to recognize
      a
      liability for vested SARS and TSARS based upon their fair value at each period
      end using a Black-Scholes option pricing model and to record a cumulative effect
      adjustment for the change in method of accounting for such liability awards.
      The
      cumulative effect resulting from the adoption of SFAS No. 123(R) was
      insignificant and is included in stock based compensation expense for fiscal
      2007.





On
      July
      13, 2006, the FASB issued Interpretation No. 48, Accounting for " Uncertainty
      in Income Taxes—an interpretation of FASB Statement No. 109 " *.* Interpretation 48 clarifies the accounting for uncertainty in income taxes
      recognized in a company's financial statements in accordance with Statement
      109
      and prescribes a recognition threshold and measurement attribute for financial
      statement disclosure of tax positions taken or expected to be taken on a tax
      return. Additionally, Interpretation 48 provides guidance on derecognition,
      classification, interest and penalties, accounting in interim periods,
      disclosure and transition. Interpretation 48 is effective for fiscal years
      beginning after December 15, 2006, with early adoption permitted. We are
      currently evaluating whether the adoption of Interpretation 48 will have a
      material effect on our consolidated financial position, results of operations
      or
      cash flows.





In
      September 2006, the FASB issued FASB Statement No.157, Fair Value Measurements
      (“FAS 157”). FAS 157 establishes a single authoritative definition of fair
      value, sets out a framework for measuring fair value, and expands on required
      disclosures about fair value measurement. FAS 157 is effective for us on June
      1,
      2008 and will be applied prospectively. The provisions of FAS 157 are not
      expected to have a material impact on our consolidated financial statements.





**


**** ***Critical
      Accounting Policies*** *.* ****** We
      suggest that our Summary of Significant Accounting Policies, as described in
      Note 1 of the Notes to Consolidated Financial Statements included in Cal-Maine
      Foods, Inc. and Subsidiaries annual report on Form10-K for the fiscal year
      ended
      June 3, 2006, be read in conjunction with this Management’s Discussion and
      Analysis of Financial Condition and Results of Operations. There have been
      no
      changes to critical accounting policies identified in our Annual Report on
      Form
      10-K for the year ended June 3, 2006.





ITEM
      3.
      QUANTATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK





There
      have been no material changes in the market risk reported in the Company's
      Annual Report on Form 10-K for the fiscal year ended June 3, 2006.




14


ITEM
      4.
      CONTROLS AND PROCEDURES




Our
      disclosure controls and procedures are designed to provide reasonable assurance
      that information we are required to be disclosed in our periodic reports filed
      with the Securities and Exchange Commission is recorded, processed, summarized
      and reported within the time periods specified in the Commission’s rules and
      forms. Based on an evaluation of our disclosure controls and procedures
      conducted by our Chief Executive Officer and Chief Financial Officer, together
      with other financial officers, such officers concluded that our disclosure
      controls and procedures are effective as of the end of the period covered by
      this report. **** There
      were no changes in our internal control over financial reporting identified
      in
      connection with the evaluation that occurred during our last fiscal quarter
      that
      has significantly affected or is reasonably likely to materially affect our
      internal controls over financial reporting.




**PART
      II.** **OTHER
      INFORMATION**








**ITEM
      1. LEGAL PROCEEDINGS**




**** Except
      as
      noted below, there have been no new matters or changes to matters discussed
      in
      our Annual Report on Form 10-K for the year ended June 3, 2006.




**Chicken
      Litter Litigation**





Cal-Maine
      Farms, Inc.(“Cal-Maine Farms”), one of our subsidiaries, is presently a
      defendant in two personal injury cases in the Circuit Court of Washington
      County, Arkansas. Those cases are styled, McWhorter vs. Alpharma, Inc., *et
      al* .
      (“McWhorter”), and Carroll, *et
      al* .
      vs.
      Alpharma, Inc., *et
      al.* (“Carroll”). Cal-Maine Farms was named as a defendant in the McWhorter case on
      February 3, 2004, and as a defendant in the Carroll case on May 2, 2005.
      Co-defendants in both cases include other integrated poultry companies such
      as
      Tyson Foods, Inc., Cargill, Incorporated, George’s Farms, Inc., Peterson Farms,
      Inc., Simmons Foods, Inc., and Simmons Poultry Farms, Inc. Alpharma, Inc. and
      Alpharma Animal Health, Co., manufacturers of an additive for broiler feed
      also
      are included as defendants.





Both
      cases allege that the plaintiffs have suffered medical problems resulting from
      living near land upon which “litter” from the defendants’ flocks was spread as
      fertilizer. The McWhorter case focuses on mold and fungi allegedly created
      by
      the application of litter. The Carroll case also alleges injury from mold and
      fungi, but focuses primarily on the broiler feed ingredient as the cause of
      the
      alleged medical injuries.





Several
      other separate, but related, cases were prosecuted in the same venue by the
      same
      attorneys. The same theories of liability were prosecuted in all of the cases.
      No Cal-Maine company was named as a defendant in any of those other cases.
      The
      plaintiffs selected one of those cases, Green, *et
      al* .
      vs.
      Alpharma, Inc., *et
      al* .,
      as a
      bellwether case to go to trial first. All of the poultry defendants were granted
      summary judgment in the Green case on August 2, 2006. The case against the
      Alpharma defendants resulted in a verdict for the defendants on September 25,
      2006. The result in the Green case is not dispositive of the issues raised
      in
      McWhorter and Carroll, but it clearly colors the plaintiffs’ prospects for
      success.





The
      plaintiffs’ attorneys have not yet indicated their intentions regarding the
      remaining cases. It is possible that the McWhorter and Carroll plaintiffs can
      present fundamentally different proof than was presented in the Green case,
      but
      that does not appear likely at present. While the potential exposure, if any,
      in
      the McWhorter and Carroll cases appears to be diminished as a result of the
      outcome in the Green case, but at this point it is still not possible to
      evaluate any potential exposure with certainty.





15





**State
      of Oklahoma Watershed Pollution Litigation**





On
      June
      18, 2005, the State of Oklahoma filed suit in the U.S. District Court for the
      Northern District of Oklahoma against a number of companies including us and
      Cal-Maine Farms. An Answer on behalf of us and Cal-Maine Farms was filed on
      October 3, 2005. The State of Oklahoma claims that through the disposal of
      chicken litter the defendants have polluted the Illinois River Watershed. This
      watershed provides water to eastern Oklahoma. The Complaint seeks injunctive
      relief and monetary damages. We no longer have any operations in the Illinois
      River Watershed. Accordingly, we do not anticipate that we will be materially
      affected by any injunctive relief granted or monetary damages
      awarded.





The
      Court
      has under advisement motions to dismiss filed by all defendants. Merit discovery
      is underway. We presently are not able to provide an opinion regarding the
      ultimate resolution of this action.





**ITEM
      1A.**  **RISK
      FACTORS**




There
      have been no material changes in the risk factors previously disclosed in the
      Company's Annual Report on Form
      10-K
      for the fiscal year ended June 3, 2006.







**ITEM
      4** **.**  **SUBMISSION
      OF MATTERS TO A VOTE OF SECURITY HOLDERS**




The
      Company’s Annual Meeting of Shareholders was held on October 5,
      2006.




The
      following persons were nominated and elected to serve as members of the Board
      of
      Directors until our next annual meeting of shareholders and until their
      successors are elected and qualified. Fred R. Adams, Jr. (40,612,051 votes
      for
      and 915,071 votes withheld), Richard K. Looper (40,599,990 votes for and 927,132
      votes withheld), Adolphus B. Baker (40,650,591 votes for and 876,531 votes
      withheld), James E. Poole (41,434,611 votes for and 92,511 votes withheld),
      R.
      Faser Triplett (40,387,236 votes for and 139,386 votes withheld), Letitia C.
      Hughes (41,398,572 votes for and 128,550 votes withheld), and Timothy A. Dawson
      (40,648,380 votes for and 878,742 votes withheld).





No
      other
      matters were voted upon at the annual meeting.





**ITEM
      5. OTHER INFORMATION** ****





On
      August
      24, 2006, in accordance with provisions of our 2005 Stock Appreciation Rights
      Plan (the “SARs Plan”), our Board of Directors approved an amendment to the SARs
      Plan providing that exercises under the SARs Plan be settled in cash and not
      with shares of our common stock.





On
      January 3, 2007, we issued a press release announcing our financial results
      for
      the quarter ended December 2, 2006.





**ITEM
      6. EXHIBITS**





No.
            
            Description10.15
            
            Loan
                Agreement, dated as of November 13, 2006, between Metropolitan Life
                InsuranceCompany
                and Cal-Maine Foods Inc. (without exhibits)31.1
            
            Certification
                of The Chief Executive Officer31.2
            
            Certification
                of The Chief Financial Officer32.0
            
            Written
                Statement of The Chief Executive Officer and The Chief Financial
                Officer99.1
            
            Press
                release dated January 2, 2007 announcing interim period financial
                information(Incorporated
                by reference to Exhibit 99.1 of our Form 8-K dated January 3, 2007.)




16




**SIGNATURES**





Pursuant
      to the requirements of the Securities Exchange Act of 1934, the registrant
      has
      duly caused this report to be signed on its behalf by the undersigned, thereunto
      duly authorized.





CAL-MAINE
                FOODS, INC.(Registrant)Date:
                January 8, 2007
            /s/
                Timothy A.
                DawsonTimothy
                A. DawsonVice
                President/Treasurer(Principal
                Financial Officer)Date:
                January 8, 2007
            /s/
                Charles F.
                CollinsCharles
                F. CollinsVice
                President/Controller(Principal
                Accounting Officer)





17