Have battery cages kept egg prices artificially low?
Sunny-side up, over-easy, or scrambled. However we like them, we like them. We get through one billion eggs each year. Retail sales are worth more than $250 million annually. The egg-eater's dilemma is that most eggs are laid by hens in battery cages, which have long been recognised as failing to protect the birds' welfare.
Battery phase out
Battery cages are finally being phased out, but it’s over a 10-year period and a decade after a similar ban took effect in the EU. The government has announced that from 31 December 2022 battery cages will be gone. Egg producers will either have to switch to "enriched" colony cages or alternatives such as barn or free range (see 'Ban timetable' below).
The decade-long phase out has managed to anger both animal welfare advocates and the industry. The former contend it's too long and argue colony cages aren't much of an improvement. The SPCA's Juliette Banks says it wants farmers to get rid of cages entirely.
For its part, the industry describes the phase-out timetable variously as “brutal”, “crippling” and “punitive”. Michael Guthrie, Chair of the Egg Producers Federation, says his members support an end to battery cages but the proposed timeframe will impose a huge financial cost on farmers and ultimately consumers.
Economies of scale
Eggs are about as cheap now as they've ever been. Statistics New Zealand figures show the price of eggs has plunged dramatically in the last 50 years. Back in 1959 a dozen eggs cost the equivalent of $10.14. You can now buy them for $3.48, around a third of the price (see our Egg prices graph, below).
The exception is free-range organic eggs, which can retail for around $10, similar to what consumers paid in the '50s.
Much of the reason for the plummet in price is the huge economies of scale offered by battery cages. Out of a total population of 3.3 million hens, around 80 percent are kept in these cages.
But cheap and plentiful eggs have come at a cost.
In 2005 the National Animal Welfare Advisory Committee, set up to provide advice to the government, conceded battery cages didn't meet the requirements of the Animal Welfare Act. It's subsequently stated the cages severely restrict the birds' ability to perform most of their normal behaviours.
The announcement of a phase-out of battery cages won't be the end of the matter. Animal welfare groups have shifted their attention to colony cages. The SPCA's Juliette Banks believes farmers who opt for colony cages "will be left selling an inferior product in a market demanding better and better welfare standards".
Meanwhile, the Egg Producers Federation says it's "formally notified" the Minister of Primary Industries that it believes the phase-out timetable is unachievable. The Federation told us it's awaiting the minister's response before it considers further action.
The retail price of eggs will rise as a result of the ban. By exactly how much is less certain.
Figures cited by the National Animal Welfare Advisory Committee suggest the long-term retail increase will be between 10 and 14 percent if battery cages are replaced by colony cages. An industry-wide move to barns would see price rises between 18 and 45 percent; a move to free range would result in hikes of between 38 and 56 percent.
Based on the cheapest prices today, these estimates would see the cost of a dozen eggs increase by 49 cents (at most) if farmers switch to colony cages. Switching from battery to free range would add a maximum of $1.95 to the price. All other things being equal, retail prices would be around what they were during the 1980s.
The ban, together with changing consumer preferences, may see a push towards more free range and barn egg production. In the UK, where a battery cage ban took effect from January 2012, production of free-range, barn and organic eggs now surpasses cage eggs.
A shift in consumer preferences is already evident here. According to industry data, in the year to June 2012 supermarket sales of free-range eggs were worth around $45 million, up 13 percent on the previous 12 months. While supermarket sales of all eggs have been increasing, free-range sales have been growing at a faster rate than sales of any other eggs.
- The ban on battery cages is overdue: it’s been clear for some time that the cages don't meet the requirements of the Animal Welfare Act.
- Eggs have dropped dramatically in price over the last 50 years but it's come at the expense of animal welfare.
- While prices will increase during the phase-out of battery cages, this rise starts from an artificially low base.
- If you're already buying barn or free-range eggs, you're unlikely to see major changes in what you pay for them.
Report by Jessica Wilson.
Data in our table below are from the Animal Welfare (Layer Hens) Code of Welfare Report by the National Animal Welfare Advisory Committee and the Code of Welfare 2012 for layer hens.
How many hens? shows numbers per cage where applicable; barn and free range are averages (rounded to the nearest hundred) taken from Comparative Assessment of Layer Hen Welfare in New Zealand published by the Ministry of Agriculture and Forestry in March 2009.
- A = average of 5 barn operations.
- B = hens can move around the shed but can't go outside.
- C = from 1 January 2014, all battery cages must provide a minimum 550cm² per hen.
|System||How many hens[width=medium]||Perches, scratching & nesting||Outdoor access[width=medium]||Hens per area[width=medium]|
|Battery cage||3 to 7||No||No||1 hen per 500cm2 for cages built before 1 January 2005; 1 hen per 550cm2 for cages built after 1 January 2005.C|
|Colony cage||20 to 90||Yes||No||1 hen per 750cm2 (or 13 hens per m2).|
|Barn||18,700A||Yes||NoB||7 hens per m2.|
|Free range||1300 (small farm), 11,100 (large farm)||Yes||Yes||9 hens per m2 inside; 1 hen per 4m2 outside.|
Battery cages will be progressively phased out over the next 10 years.
Every 2 years from 1 January 2016, cages older than 17 years must be removed from production. 45 percent of cages are expected to be gone by 2018. All cages must be removed by 31 December 2022.
Colony cages will largely take their place. These cages typically house around 40 to 60 hens and provide perching, nesting and scratching areas. The National Animal Welfare Advisory Committee describes colony cages as an "attempt to balance the hens' requirements to express their behavioural needs [while retaining] ... the ability to maintain close control of the[ir] environment."
The EU ban on battery cages was announced in 1999 and took effect on 1 January 2012. According to the agri-business monitoring firm WattAgNet, EU egg production was slightly lower in 2012 but was expected to lift again in 2013. WattAgNet says the EU remains self-sufficient in eggs and the "often predicted collapse in the industry has not occurred".
Other changes to the Code of Welfare for layer hens have been introduced.
Induced or forced moulting will no longer be permitted. The practice has been used to increase the productive lifespan of hens. Moulting is induced by withholding food, which causes the bird to stop laying and shed its feathers. When the feathers grow back, the bird resumes laying. The practice causes significant stress to the bird and is linked to an increase in mortality rates.
Changes have also been made to beak-trimming, used to reduce the risk of injuries from pecking. The National Animal Welfare Advisory Committee says beak trimming has traditionally been done using a hot blade, which causes severe pain to the bird.
Hot-blade trimming has now been replaced by a newer technique that uses an infra-red beam to soften and erode the beak tip. This technique can also cause pain. The code now restricts its use to chicks in the first three days after hatching as it's believed young chicks don't suffer adversely. The practice can only be used on adult birds in an "emergency".
Free to range?
"Free range" has been a relatively loose term when it comes to eggs.
It may conjure up images of small flocks of foraging hens. But most free-range eggs are laid by birds in industrial-scale operations.
Changes to the Code of Welfare for layer hens have belatedly introduced new requirements for free-range egg farms.
Among them is the introduction of a maximum outdoor stocking density of 2500 birds per hectare – around 4m² per bird. The code recommends less than 900 hens per hectare as "best practice".
Management of the outdoor range area is expected to ensure that the hens use the range frequently. According to the code, this should include providing trees, shrubs or other shelter to give protection from perceived predators such as hawks.
Indoor stocking densities for free-range hens have been reduced from 10 to 9 hens per m². But the code doesn't prescribe maximum flock sizes.
The number of hens in a free-range operation can vary widely: from an average of 1300 hens on a small farm to 11,100 on a large one.
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