Free Range Egg Production Costs Cracked by ADAS19 June 2013
UK - When the British Free Range Egg Producers Association (BFREPA), the National Farmers’ Union (NFU) and the UK egg packers association NEMAL wanted an independent, industry-agreed, cost of free range egg production they called in ADAS to help.
John Newton, Senior Consultant within the ADAS Sustainable Food and Farming Group explains how the unique position of ADAS within the egg industry made this possible.
Traditionally, calculations of free range egg costs of production performed by the NFU and BREFPA were often disputed by the egg packing companies. It was decided by both the producers and egg packers that a new and independent calculation of costs was needed. On the basis of its knowledge of the egg sector and its recognised independence, ADAS were approached by both sides of the industry to calculate average free range egg costs of production.
Achieving an agreed set of costings has been seen as a significant breakthrough by Robert Gooch, BREFPA’s Director of Policy and one which will help in any future discussions about egg prices. He said recently in the Ranger magazine, “We now have an industry-wide standard for costs that the packers, the NFU and BREFPA are all agreed on. That is a major step forward.”
The work on producing the average costs of production has been undertaken by ADAS who analysed production data, obtained anonymously from more than 50 free range egg producers, to arrive at an average cost of production. Data was obtained from a wide range of units – from producers with just 3,000 to 4,000 layers up to units of 36,000 layers. Information was obtained from poor performing flocks as well as good ones in order to arrive at a robust industry average.
The figures, which are re-calculated monthly, take into account the cost of feed, pullets, labour and all other inputs, as well as a figure for depreciation and interest charges on buildings and equipment.
ADAS has considerable experience in undertaking a range of poultry valuations and costings for public and private companies in addition to offering more general economic advice. Contact John Newton on 01284 763907 or email firstname.lastname@example.org to find out how ADAS can help you.
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