Consumer Egg Prices Could Rise by 25 Per Cent

US - Consumers could be forced to pay 25 per cent more for eggs soon if animal rights activists succeed in getting only non-cage eggs sold in the US, according to a new study by a respected economic consulting group.
calendar icon 7 October 2009
clock icon 4 minute read

That increase would cost consumers $2.6 billion more each year for eggs, a nutritional staple in the American diet. The higher costs would strain Americans' budgets during a difficult economic climate.

Federal spending on food assistance programs for children and the needy also would increase by $169 million annually if the government could only purchase cage-free eggs, according to the study by Promar International, a Washington, D.C. economic consulting firm. Significant amounts of eggs are purchased for the school lunch and breakfast program ($47 million annually); Special Supplemental Nutrition Program for Women, Infants and Children (WIC-$100 million); and the Supplemental Nutrition Assistance Program (SNAP-formerly the Food Stamp Program).

The study predicts that such a dramatic consumer cost increase could open the door to a sharp rise in egg imports from other countries that have far lower food safety and animal welfare standards than the United States. Egg imports could rise from virtually zero today to 7 billion eggs annually, seriously straining the ability of the US government's food safety inspection system.

"If we have to start importing eggs into this country we will increase our food safety risks," said Gene Gregory, president of United Egg Producers, a national cooperative of US family egg farmers. "I don't think American consumers really want to play Russian Roulette with every carton of eggs they buy, which is essentially what would happen if we allow special interest groups to force a ban on the most modern, sanitary egg housing systems in the world. Those systems are used to produce 95 per cent of the eggs that American consumers buy every day."

"More imports would also likely increase the carbon footprint of a dozen eggs since they would be transported over long distances," Mr Gregory added.

Bans on modern cage housing systems already are being implemented in California over the next 5 years and several other states because of pressure from animal rights groups.

Similar bans are being implemented in Germany next year and in many European countries in the next few years, which will not necessarily improve the health and welfare of chickens and may have negative consequences for the environment, consumer and government costs, and endangering food safety.

USDA statistics indicate that on average during early September 2009, one dozen grade A "regular" eggs were advertised at retail for $1.00 per dozen compared to $1.59 per dozen for cage-free. Cage-free eggs cost more because they require more land, more labor, more energy and more food per hen, Tom Earley, the author of the study, explained. Cage-free chickens also tend to have more diseases which need to be treated with expensive medicines, and they have higher mortality rates.

American consumers currently have the right to choose (and buy) whatever type of egg they prefer and can afford: "regular" eggs from modern, sanitary cage housing systems; cage-free (no access to outdoors); or free range (at least some access to outdoors). Approximately 95 per cent of American consumers choose "regular" eggs when they make their purchase decisions at the grocery store and eggs are among the lowest cost sources of high-quality protein, making them an ideal meal solution for low-income Americans. The need for food assistance nationwide has increased 30 per cent throughout the last year, according to the website for Feeding America, the nation's leading domestic hunger relief organization, which says that 35 million people are at risk of hunger in America.

Eggs are produced commercially in 49 states. Nearly all commercial egg farms in the US are family-owned farms or farmer co-ops; there is only one publicly traded company. Approximately 95 per cent of egg-laying hens in the US are housed in modern cage facilities. The cost to farmers of converting their modern hen houses into cage-free facilities would be $7.5 billion, the study estimates. The availability of credit and local permits could be a major obstacle for many farmers.

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