Egg Industry News

 

USDA Weekly Egg Price and Inventory Report, July 20th 2017.

Jul 21, 2017

    

Hen Numbers Increase Slightly but Prices Up Again After Post July 4th Rise.

OVERVIEW

According to the USDA Egg Market News Reports posted on July 17th the Midwest wholesale prices for Extra Large and Large sizes increased by11 percent from the previous week. The market will be influenced by hen inventory on the supply side of the equation. The progression of prices during 2017 is depicted in the USDA chart reflecting three years of data, updated weekly.

  

The July 17th USDA Egg Market News Report documented a USDA Combined Region value of $0.73 per dozen delivered to warehouses. This price lags Midwest Weekly values by one week, and is compared to a trailing peak price of $2.20 per dozen in late November 2015.  The USDA Combined range for Large, in the Midwest was $0.68 per dozen. At the high end of the range, the price in the Southeast Region, attained $0.77 per dozen. The current USDA Combined Price was approximately 57 cents per dozen below the three-year average. During the first Quarter of 2016 the average was inflated by the rise in prices attributed to the post-HPAI shortage of shell eggs and breaking stock.

The number of producing hens this week was 0.4 million higher at 304.9 million despite producers removing flocks held over going into the Independence-day weekend. The population is at a high level relative to demand. The total egg-flock comprises 312.4 million including hens in molt and small flocks

Generic shell-egg stock fell by 1.8 percent compared to a fall of 1.1 percent for the previous week confirming fluctuation in the balance between demand and production. Dried-egg inventory amounted to 28.0 million pounds (12,723 metric tons) as of May 31st 2017. This is extremely high, as is the National stock of frozen egg products reported on June 22nd confirming a stock of 39.5 million pounds (17,936 metric tons) on May 31st down from 41.2 million pounds on April 30th.  

INVENTORY

Cold storage stocks in selected regions on July11th 2017 amounted to 3.109 million pounds (1,413 metric tons), 2.1 percent below the stock of 3.176 million pounds during the week of July 1st. 2017.

The latest monthly USDA Cold Storage Report released on June 22nd documented a total stock of 39.459 million pounds (17,936 metric tons) of frozen egg products on May 31st 2017. This value was up 9.7 percent from May 31st 2016. Approximately 88 percent of inventory comprised the categories of “Whole and Mixed” (33.4 percent) and “Unclassified” (55.2 percent).

The national stock of generic shell eggs on July 17th was down by 1.8 percent, compared to a 1.1 percent decrease in inventory during the previous week. Four regions showed decreases in stock levels. The Midwest Region was down 11.6 percent compared to the previous week to 350,300 cases. This region was followed in decreasing order of stock level by the Southeast Region up by 8.1 percent to 267,100 cases; the South Central Region down by 2.4 percent to 226,500 cases; the Southwest Region down by 4.4 percent to 164,700 cases, the Northeast Region down by 1.0 percent to 132,300 and the Northwest Region up by 24.5 percent (a 51.4 percent swing in a week) to 87.600 cases.

The total USDA Six-Area stock of commodity eggs comprised 1,529,100 cases, of which 80.3 percent were shell eggs. The inventory of breaking stock was down 9.5 percent to 300,500 cases after a short-work week. The price of breaking stock this week reflects the availability of eggs from both mature and young flocks in relation to the demand for generic eggs.

Specialty egg inventory was down by 3.2 percent compared to a fall of 5.4 percent for the previous week to 184,100 cases with organic stock comprising 54.6 (was 53.3) percent of inventory. Recent data suggests a fluctuating build in the stock of USDA Certified Organic product. This is attributed to an apparent trend by consumers to purchase less-expensive brown cage-free product over organic eggs when there is a wide differential in price.

During the past week the USDA benchmark retail price of cage-free brown rose markedly by 22.7 percent, or 61 cents per dozen to $3.29 per dozen while USDA Certified Organic fell by 1.5 percent or 6 cents per dozen to $3.82 per dozen, narrowing the price differential to $0.53 per dozen ($1.20 per dozen last week) suggesting larger purchases of the organic category in the coming week at the expense of cage-free eggs.  Large week-to-week percentage fluctuations can be expected in the stock of specialty and organic eggs based on the small base of these categories.

   
 

Utah “Ag-Gag” Law Declared Unconstitutional

Jul 21, 2017

    

According to an article in the July 8th Salt Lake Tribune, U.S. District Judge Robert Shelby has ruled unconstitutional the Utah statue which addresses deliberately evasive and incorrect declarations on employment applications, in addition to filming and recording on farms for the express purpose of supporting animal right advocacy groups. His opinion ruled that the law enacted violates the free speech rights of individuals.

The Utah Animal Rights Coalition sued in Federal court to have the 2012 law declared unconstitutional.  The ruling will have implication for the “Ag-Gag” Laws enacted by other states including North Carolina.

  

   
 

Severe E. coli Outbreak in Utah

Jul 21, 2017

    

A relatively insular religious community on the Utah-Arizona border has been affected by an outbreak of E. coli infection.  Two children have died of hemolytic uremia syndrome and eleven others have been hospitalized. 

The infection is not associated with the water supply from the town of Hildale according the Utah Department of Public Health.  In the absence of an identified vehicle of infection, residents are being warned to cook meat thoroughly, refrigerate food and to only drink pasteurized milk.

The infection involves residents of the contiguous towns of Hildale, UT. and Colorado City, AZ.

  

The E. coli isolated from patients was characterized as a strain producing Shiga toxins. Most of these pathogens were previously associated with ground beef but recently a wide variety of green produce and other foods have served as vehicles of infection.

   
 

Scandal over Deceptive Labeling of Eggs in New Zealand

Jul 21, 2017

    

Since March of this year, the Serious Fraud Office of the New Zealand Government has investigated deceptive labeling of eggs derived from caged hens sold as cage-free and free-range.  Palace Poultry appears to be the focus of complaints. Accordingly supermarket chains have removed eggs supplied by Palace Poultry from their shelves.

  

Palace Poultry apparently sold eggs to a second producer Zeagold Eggs which markets under the Woodland’s and Farmer Brown brands.  This has created the potential for a more extensive recall and degradation of brand image.  Zeagold appears to be an innocent party having paid the going wholesale rate for cage-free eggs.  The Managing Director of the holding company of Zeagold, Michael Guthrie, is also Chairman of the Egg Producers’ Federation. 

An investigation has shown that the quantity of eggs marketed through a number of supermarket chains including Countdown could not have been supplied from the free-range flocks operated by Palace Poultry on their farm in Araimu.  Palace Poultry apparently was purchasing eggs from Eco Foods produced by caged hens and were then deceptively packaged as “free-range”.

Provided eggs are not washed it is possible to differentiate between product derived from cages or on litter or free-range by microscopic examination of debris on the surface of the shell.  This approach was used in the EU when a similar scandal emerged in 2012, with eggs imported from Spain mislabeled as “cage-free”. In the U.S. where eggs are routinely washed, it is not possible to differentiate between caged product and eggs from alternative systems.

To restore customer confidence, New Zealand producers will in all probability introduce a system of stamping individual eggs using a jet printer. This would follow the system in the E.U. in which housing system, farm of origin and date of production are imprinted on each egg coupled with appropriate trace-back and monitoring.  It would also be possible to audit companies since farms in New Zealand are relatively small in scale given the structure of the industry. The number of eggs sold by a producer or packer could be correlated with the sizes of flocks housed in a specific system with appropriate adjustments for traded eggs.

   
 

Additional Farms Report H5N8 AI in South Africa

Jul 21, 2017

    

The inevitable spread of H5N8 in South Africa, predicted in a previous post, is now a reality with two layer farms falling to the virus in Gauteng and Mpumalanga Provinces respectively. These cases bring to four the number of identified outbreaks.

It is speculated that given the extensive population of subsistence chickens among concentrations of agricultural workers in remote rural areas, the live bird marketing system and the fact that spent hens are traded and sold in street markets, control of H5N8 avian influenza will be extremely difficult.

  

At best the Government could create a situation similar to Vietnam in the early 1990s when it was possible to restrict H5N1 influenza to back yard and subsistence farms and prevent outbreaks in commercial broiler breeder and grower units applying strict biosecurity.

Given that the index farms in Zimbabwe and South Africa were commercial breeder units with presumably adequate Structural and Operational biosecurity, deficiencies in procedures must be present to allow infection to extend from wild bird carriers or from backyard chickens. The results of surveillance would be instructive in this respect

   
 

National Organic Program Releases List of Fraudulent Certificates

Jul 21, 2017

    

EGG-CITE has long maintained that the entire USDA-Certified Organic program depends on paperwork without any meaningful laboratory assay to determine freedom from pesticides or non-GMO status of ingredients fed to livestock.

From time to time, the National Organic Program releases a list of fraudulent organic certificates and identifies companies participating in illegal activities and claims as to compliance with U.S. organic standards. It is significant that a large number of companies involved in fraud are based in Asia from which a large proportion of presumably organic products originate.

  

The differential in value between generic and organic products is sufficiently wide as to justify deceptive labeling. If a shipload of corn or soybeans can acquire appropriate documentation between the port of loading and arrival in the U.S. value can be doubled, attracting suppliers willing to generate illegal profits. On the other side of the transaction, there are many buyers of allegedly organic products that are willing to “look the other way” and accept at face value pieces of paper of doubtful provenance signifying organic status.

   
 

Harris Teeter to Open New Store but to Close Two Others

Jul 21, 2017

    

The Harris Teeter division of the Kroger Company will closes stores in Greensboro, NC. and Cary, NC. over the next two months. 

Kroger opened ten new stores under the Harris-Teeter banner in 2016 and will open six stores in the Carolinas and Maryland during the current year. 

 

The new Brier Creek suburban Harris Teeter location in Raleigh, NC. will comprise a 64,000-foot2 prestige location with hot food, a sit-down wine and beer bar and a drive-through pharmacy.

There has been considerable activity in the North Carolina Triangle Area with Wegmans, and Publix opening new stores and an upgrade of the Food Lion chain owned by Ahold-Delhaize.

   
 

Australia Develops GM Banana for Uganda

Jul 21, 2017

    

Applying a $10 million grant from the Bill and Melinda Gates Foundation a team led by Prof. James Dale at the Queensland University of Technology has developed a GM banana* with the potential to alleviate malnutrition associated with Vitamin A deficiency.

The cultivar has been transferred to Uganda where it is undergoing field evaluation.

 

In many nations of the World, including East Africa and especially India, Vitamin A deficiency results in blindness and also stunting in children. Unfortunately previous cultivars of rice engineered to express high levels of pro-vitamin A have not been commercialized due to opposition from vested interests. (see previous posting on July 13th 2014 by entering “banana” in the SEARCH block.)

It is hoped that the “do-gooders” of the developed world will not deprive those in need of a valuable food product. In the case of Golden Rice, commercialization has been impeded by restrictive legislation and negative publicity advanced on the basis of universal rejection of GM technology and supported by sophistry and misinformation.

*Paul, J-Y, et al Golden Bananas in the Field: Elevated Fruit Pro-Vitamin A, From the Expression of a Single Banana Transgene. Plant Biotechnology Journal. 15:520-532 (2017)

Prof. James Dale of the Queensland University of Technology, Australia developed the GM Banana

       

Golden Bananas on trial in Uganda

 

   
 

USDA Projections for 2017 and 2018 Egg Production

Jul 21, 2017

    

The USDA Economic Research Service issued an updated July 18th record of egg production in 2016, an update for 2017 and a forecast for 2017. Values are compared to 2015 which was impacted by the Spring outbreak of HPAI in the upper-Midwest.

 

Parameter

2015 (actual)

2016 (actual)

2017 (forecast)

Difference ‘16-‘17

EGGS

 

 

 

 

Production (m. dozen)

6,938*

7,435

7,642

+1.6%

Consumption (eggs per capita)

         256*

          275

           277

+0.7%

New York price (c/doz.)

         182*

            86

             85

-1.1%

Source: Livestock, Dairy and Poultry Outlook – July 18th 2016

*Impacted by Spring 2015 HPAI outbreaks. Consumption in 2014, 267 eggs per capita

Subscribers to EGG-CITE are referred to the postings depicting weekly prices, volumes and trends and the monthly review of prices and related industry statistics.

   
 

Moba USA Appoints Northeast Agri Systems as an Agent

Jul 21, 2017

    

In a July 20th release, Moba USA, a subsidiary of Moba, has contracted Northeast Agri Systems, as a new representative for Moba and Diamond farm packers in the Northeast region.

 

Northeast Agri Systems will sell and service the following products:-

  • Mopack 55 – 150 grader installations
  • Diamond 70, 100 and 200 FPX farm packers
  • Moba and Diamond stackers
  • MR 40 skid-building robots

Moba has a global reach with approximately 700 employees serving the egg industry. Company brands include Moba, Diamond and Pelbo offering a broad portfolio of solutions for the industry. Moba is located in Barneveld, the Netherlands, with subsidiaries in England, Germany, the USA, Malaysia, Japan, China and Italy. Moba is represented in more than 60 countries through an extensive network of agents.

   
 

Status of 2017 Corn and Soybean Crops

Jul 21, 2017

    

The USDA Crop Progress Report released Monday July 17th  recorded progress in corn and soybean progress and condition similar to 2016 as expressed in the table below:-

 

  

                                                                            WEEK ENDING

Crop

July 9th

July 16th

5-Year Average

Corn and Soy Emerged

         100

         100

          100

Corn Silking

           19

           40

            47

Soybeans Blooming

           34

           52

            51

Soybeans Setting Pods

      7   

           16

            13

                  

Crop

V. Poor

Poor

Fair

Good

Excellent

Corn Condition

     3         

   8

 25

  52

     13

Soybean Condition

     3

   8

 28

  51

     10

 

Parameter

v. Short

Short

Adequate

Surplus

Topsoil moisture:  Past Week

    14

   26

53

 7

                              Past Year

8

22

62

 8

Subsoil moisture:  Past Week

    11

   25

58

 6

                              Past Year

7

21

66

 6

 

   
 

South East Egg Industry Conference

Jul 21, 2017

    

Henning Companies was a sponsor for the SE Egg Industry Regional Conference at Palm Coast, FL on June 14-16.

Educational sessions were held covering, management, bird health, transition from cage to cage-free production, impact of alternative housing on protein and energy consumption, and managing profitability with high feed cost.

 

Pictured Above (L-R): Curt Schmidt (Hy-Line North America), Lisa Henning-Beohm (Henning Companies)
Trey Braswell (Braswell Family Farms), Brent Booker (Country Charm Eggs) and
Pete Block (Hy-Line North America) during the awards banquet.

   
 

Egg price at Aldi store in the St. Louis MO. Area

Jul 21, 2017

The price says it all!

   
 

Chipotle Suffers From Double Blow of Norovirus and Mice

Jul 20, 2017

    

Just when analysts were expressing cautious optimism over the recovery of Chipotle Mexican Grill after the foodborne infection fiascos of 2015, events stoked by negative publicity are degrading the healthful image embodied in the brand.

  

The outbreak of confirmed norovirus infection attributed to a Sterling, VA. store has apparently claimed 130 presumptive reported cases. This suggests contamination of the implicated store over a multi-day period due either to defective cleaning and decontamination at close of operations or extended shedding of virus by one or more employees.

Chipotle stock is displaying the market equivalent of anaphylaxis, with a 2.2 percent drop from the opening on Friday 21st to $348.32 at noon. The 52-week range has been $345.75 to $499.00, far below the $700 to $750 trading range before the advent of the series of 2015 foodborne disease episodes.

To add to Chipotle image problems diners at a West End, Dallas TX. location posted a video of three apparently non-blind mice with intact tails suggesting that the nursery-rhyme “Farmer’s Wife” is not employed by Chipotle. 

Cynically the rodents that “dropped from the ceiling” may have been over-optimistic financial analysts. An image of investor Bill Ackman dining in a New York Chipotle restaurant is not substantially encouraging to market capitalization. Hopefully his taste in food is better than his taste in stocks given the recent record of his fund. On the other hand he may be volunteering as a “lab rat” to confirm that Chipotle food is wholesome.

Bill Ackman tweets:
Eating our own cooking @ ChipotleTweets
and making my own mix at savorwavs.com"

 

 

   
 

Australian Supermarkets Compete with Eggs as Loss Leaders

Jul 20, 2017

    

Major Australian supermarkets including Coles, Woolworth’s and Aldi have all reduced the price of their house-brand, free-range eggs by as much as 30 percent. It is estimated that this has resulted in complaints from the industry implying that “loss leader” pricing on eggs could result in deceptive practices.

At the core of the issue is the definition of “free-range” which can mean stocking densities of 3,750 hens per acre as per the CSIRO guideline or 25,000 hens per acre as adopted by some producers. CHOICE, an advocacy group lists on their website the 250 brands complying with the CSIRO low density “free range” standard.

  

Although supermarkets have slashed prices to consumers, chains such as Aldi and Woolworth’s have apparently not reduced unit payment to packers and producers.

The messages for the U.S. from the present situation in Australia are:-

  • There must be a clear definition of a product with appropriate labelling and 3rd-party monitoring of production systems, flock sizes and documentation.
  • Specialty eggs labelled as “free-range”, “from pastured flocks” and “cage-free” are non-competitive against less expensive conventional eggs from cages on the same store shelf. Everyone “wants” eggs from non-caged flocks but only a minority of consumers are actually willing to pay the difference given alternatives, despite what they may submit in surveys.
  • Food retailers will try to optimize sales per unit of shelf space and maximize overall basket prices. If low-priced eggs from cages contribute to this objective, long-term commitments to “cage-free” adopted in haste and under coercion, may be reversed, diluted or extended.

   
 

CME Prices

Jul 19, 2017

    

On Friday July 14th at close of trading on the CME, the following rounded quotations for corn, soybeans and soybean meal were recorded, together with the bracketed value for the previous week. Values were lower, reversing the advances of the previous week.

This is attributed to the release of the WASDE Report #557 on July 12th detailing increased ending stocks for corn (2,325 million bushels) but despite a decline in soybeans (460 million bushels).

  

According to the July WASDE release, a 90.9 million acres were planted to corn, three percent lower than the previous season with a predicted harvest of 14.3 billion bushels. Farmers planted 88.7 acres to soybeans, up seven percent above 2016, with a crop of 4.3 billion bushels anticipated.

 

COMMODITY

 

Corn (cents per bushel)

July ’17   369  (382)    

Sept. ’17  377   (391)  

Soybeans (cents per bushel)

July ’17   987  (992)    

Sept. ’17  994   (1,003)  

Soybean meal ($per ton)

July ’17   322  (327)

Sept’17    325   (331) 

 

 

Changes in the price of soybeans and soybean meal this week were:-

  • Corn:                     July quotation down by 13 cents.                    (-3.4 percent)
  • Soybeans:            July quotation down by 5 cents                       (-0.5 percent)
  • Soybean Meal:   July quotation down by $5/ton                        (-1.5 percent)                                  

 

For each 10 cent per bushel change in corn :-

  • The cost of egg production would change by 0.45 cent per dozen
  • The cost of broiler production would change by 0.25 cent per pound live weight

 

For each $10 per ton change in the price of soybean meal:-

  • The cost of egg production would change by 0.40 cent per dozen
  • The cost of broiler production would change by 0.25 cent per pound live weight

See posting on the June edition of CHICK-CITE (enter WASD in SEARCH block) summarizing the July 12th USDA-WASDE Report #567, for a review of price projections and quantities of commodities produced during the 2016-17 season.

   
 

USDA Weekly Egg Price and Inventory Report, July 12th 2017.

Jul 17, 2017

    

EGG-CITE regrets omitting the weekly summary based on the USDA Egg Market News Report and other sources. The item is now distributed to subscribers.

 

Hen Numbers Increase Slightly but Prices hold after Pre-July 4th Rise.

 

OVERVIEW

According to the USDA Egg Market News Reports posted on July 12th the Midwest wholesale prices for Extra Large and Large sizes increased by 3 percent from the previous week. The market will be influenced by hen inventory on the supply side of the equation.

The progression of prices during 2017 is depicted in the USDA chart reflecting three years of data, updated weekly.

  

The July 12th USDA Egg Market News Report documented a USDA Combined Region value of $0.70 per dozen delivered to warehouses. This price lags Midwest Weekly values by one week, and is compared to a trailing peak price of $2.20 per dozen in late November 2015.  The USDA Combined range for Large, in the Midwest was $0.66 per dozen. At the high end of the range, the price in the Northeast Region, attained $0.75 per dozen.

The current USDA Combined Price was approximately 57 cents per dozen below the three-year average. During the first Quarter of 2016 the average was inflated by the rise in prices attributed to the post-HPAI shortage of shell eggs and breaking stock.

The number of producing hens this week was 0.4 million higher at 304.5 million despite producers removing flocks held over going into the long weekend. The population is at a high level relative to demand. The total egg-flock comprises 312.0 million including hens in molt and small flocks

Generic shell-egg stock fell by 1.1 percent compared to a fall of 4.3 percent for the previous week confirming fluctuation in the balance between demand and production. Dried-egg inventory amounted to 28.0 million pounds (12,723 metric tons) as of May 31st 2017. This is extremely high, as is the National stock of frozen egg products reported on June 22nd confirming a stock of 39.5 million pounds (17,936 metric tons) on May 31st down from 41.2 million pounds on April 30th.  

INVENTORY

Cold storage stocks in selected regions on July 4th 2017 amounted to 3.188 million pounds (1,449 metric tons), 9.3 percent below the stock of 3.486 million pounds during the week of June 1st. 2017.

The latest monthly USDA Cold Storage Report released on June 22nd documented a total stock of 39.459 million pounds (17,936 metric tons) of frozen egg products on May 31st 2017. This value was up 9.7 percent from May 31st 2016. Approximately 88 percent of inventory comprised the categories of “Whole and Mixed” (33.4 percent) and “Unclassified” (55.2 percent).

The national stock of generic shell eggs on July 10th was down by 1.1 percent, compared to a 4.3 percent decrease in inventory during the previous week. Three regions showed decreases in stock levels. The Midwest Region was up 6.3 percent compared to the previous week to 396,100 cases.

This region was followed in decreasing order of stock level by the Southeast Region up by 0.9 percent to 247,200 cases; the South Central Region down by 3.7 percent to 232,000 cases; the South West Region down by 10.6 percent to 172,400 cases, the Northeast Region up by 12.7 percent to 133,700 and the Northwest Region down by 26.9 percent to 70,300 cases.

The total USDA Six-Area stock of commodity eggs comprised 1,583,700 cases, of which 79.0 percent were shell eggs. The inventory of breaking stock was up 20.8 percent to 332,000 cases reflecting a short-work week. The price of breaking stock this week reflects the availability of eggs from both mature and young flocks in relation to the demand for generic eggs.

Specialty egg inventory was down by 5.4 percent compared to a rise of 2.6 percent for the previous week to 190,100 cases with organic stock comprising 53.3 (was 51.4) percent of inventory. Recent data suggests a fluctuating build in the stock of USDA Certified Organic product. This is attributed to an apparent trend by consumers to purchase less-expensive brown cage-free product over organic eggs when there is a wide differential in price.

During the past week the USDA benchmark retail price of cage-free brown fell by 4.2 percent, or 12 cents per dozen to $2.68 per dozen while USDA Certified Organic fell by 0.5 percent or 2 cents per dozen to $3.88 per dozen, widening the price differential to $1.20 per dozen ($1.10 per dozen last week).  Large week-to-week percentage fluctuations can be expected in the stock of specialty and organic eggs based on the small base of these categories.

According to the latest monthly USDA Cage-free Hen Report for June 30th the number of hens held in other than conventional cages during June was stable for organic and cage-free flocks.:-

Total U.S. flock held for USDA Certified Organic production = 14.6 million May and June   (14.5 million, April)

Total U.S. flock held for cage-free production                          =  27.3 million May and June   (26.6 million, April)

Total U.S. non-caged flock                                                      =  41.9 million (13.6 percent of a nominal 307 million flock but 21.0 percent of a presumed flock of 200 million held for shell-egg production)                                        

For the week ending July 8th eggs processed under FSIS inspection decreased by 5.5 percent compared to the previous week to a level of 1,425,840 cases. The proportion of eggs broken by in-line complexes reached 58.5 percent (was 54.5 percent last week). During the corresponding week in 2016 in-line breakers processed 55.4 percent of eggs including limited imports, denoting recovery from the severe mortality affecting approximately nine large in-line complexes affected by HPAI in 2015. 

   
 

Council for Biotechnology to Promote Advantages of GMO Products

Jul 14, 2017

    

The Council for Biotechnology will post reports and comments by scientists debunking myths and promoting the advantages of GMO technology and products.  Items will be abstracted from a report GM Crops: Global Socio-Economic and Environmental Impacts- 2015 prepared under contract by PG Economics.

Given the intensity of opposition to GM and recognizing the complexities of the issues involved in the technology, the Council of Biotechnology are adopting an inappropriate strategy to win over consumers.

  

It has been stated unequivocally that to fight public opinion with science is to lose with science.  The Council would be better served by using spokespersons drawn from sports and entertainment media to endorse GM products and to offer simple, non-complex and convincing arguments supporting GM and its contribution to sustainability, productivity and nutrition.

   
 

Relationship between Quinolone Antibiotics and Triclosan Disinfectant

Jul 14, 2017

    

Cooperative research conducted by the University of Birmingham and the Norwich Research Park* has determined a relationship between bacteria developing resistance to quinolone antibiotics and triclosan a widely used disinfectant.  It was demonstrated that bacteria developing defense mechanisms against quinolones are also resistant to triclosan. 

The concern is that extensive exposure to the compound, which is included in hand, soaps and disinfectants used in medical facilities will result in the reverse situation in which bacteria become resistant to quinolones, which are widely used, in human therapy.

  

In recent years there has been increasing concern over the widespread use of triclosan which demonstrates minimal benefits over conventional soap and water for disinfecting hands, resulting in bans in the E.U. and U.S. for skin and body washes.

*Webber, M. A. et al Quinolone-Resistant Gyrse Mutants Demonstrate Decrease Susceptibility to Triclosan. Journal of Antimicrobial Chemotherapy 2017: DOI: 10.1093/jac/dkx 201.

   
 

Lidl to Open Seven Additional Stores

Jul 14, 2017

    

Lidl will open seven new stores during late July, all in the Richmond VA market consistent with previous announcements.

   
   
 

Amazon Struck Hard Bargain with Whole Foods Market

Jul 14, 2017

    

According to a July 7th posting by Jon Springer in Super Market News, Amazon struck a hard bargain with Whole Foods Market (WFM). 

Under pressure by activist investors, John Mackey reviewed offers from “an industry participant” which would have priced WFM at $35 to $45 per share. 

With other suitors in the wings, Mackey reached out to Amazon and a meeting took place on April 30th in Seattle.

  

Jeff Bezos

Amazon offered $41 per share in early June with Whole Foods countering at $45.  Investment banker Goldman Sachs increased the offer to $42 per share stressing a ‘best and final offer’ and requiring an immediate yes or no response.  According to the article, John Mackey was “in love” with the Amazon connection and the Board agreed to the terms offered.

Notwithstanding the difference between $45 and $42, industry observers commented that the price “likely exceeded the price level that a private equity buyer could reasonably be expected to pay while achieving customary expected returns from such an investment.”  Obviously Amazon anticipates synergy from the acquisition.

   
 

Wegmans Food Markets to Commence Home Delivery

Jul 14, 2017

    

Wegmans Food Markets, a consistent top-ranked supermarket on consumer satisfaction surveys announced that it will team with Instacart to deliver grocery orders placed online. 

Initially the service will commence in northern Virginia and Maryland but will be extended to other areas.

Instacart also services Publix and H-E-B among other chains.

  

Chief Business Officer for Instacart, Nilam Ganenthiran noted that the agreement with Wegmans was negotiated over an extended period.  Ganenthiran added, “Wegmans is one of the handful of truly beloved grocers across the country, privately held, extremely discerning and known for high-quality customer service.”  He added “We spent a lot of time getting to know the team at Wegmans to try to find ways to work together.” 

Instacart charges $6 for orders of $35 or more but an express E-membership is available providing free one-hour deliveries on orders over $35 for an annual membership ranging from $100 to $150.

   
 

Courts Rule on CAFO Emission Reporting

Jul 14, 2017

    

The Circuit Court of Appeals for the District of Columbia will not reconsider the decision that the EPA must continue to demand air emission reports from Concentrated Animal Feeding Operations (CAFOs).

The Court ruled that the EPA was not entitled to exempt farms from submitting emergency release reports in terms of the Comprehensive Environmental Response Compensation and Liability Act.

  

The National Pork Producers Council and the U.S. Poultry and Egg Association petitioned the court for a re-hearing in June claiming that the environmental activist groups lack standing to initiate a claim.

USPOULTRY noted its disappointment in the decision commenting, “These reports are a meaningless exercise in paperwork and they have potential to preoccupy first responder’s valuable time and resources.”  The Court decision was based on the reasoning that the EPA lacks the jurisdiction to ignore statues even if it consider that reporting requirements are worthless.

Environmental groups opposed to intensive livestock agriculture include the Sierra Club, Center for Food Safety, the Humane Society of the United States and the Environmental Integrity Project were plaintiffs.  Both the EPA and the Livestock Producers Associations are evaluating further action.

   
 

Henning Companies Erects New Houses for Michael Foods

Jul 14, 2017

    

Henning Companies is in the process of erecting six cage-free layer houses to replace 16 existing barns equipped with conventional cages at the M.G. Waldbaum subsidiary in Bloomfield, NE. 

Demolition of eight layer houses in the first phase was completed in early 2017 followed by construction of the first of the six new houses.  The project will include passageways for egg transport and a manure storage building and tunnels to convey waste.

  

The first building will be populated in January 2018.  Each building comprises two levels separated into two compartments fitted with Vencomatic aviaries.  The buildings incorporate Structural Insulated Panels developed by Henning.

   
 

Monthly Egg Statistics

Jul 14, 2017

    

JUNE 2017 USDA EX-FARM BENCHMARK PRICE RISES SIX PERCENT,
COSTS STABLE BUT NEGATIVE MARGINS PERSIST.

Introduction.

Summary tables for the latest USDA 2017 June statistics and prices made available by the EIC on, July 10th 2017, are presented together with comparison values from the previous June 7th 2017 posting reflecting May 2017 data.

  

 

COSTS & REVENUE                                                                                         

Parameter

MAY 2017

JUNE 2017

5-Region Cost of Production ex farm (1st Cycle)

59.94 c/doz

59.89 c/doz

Low

55.11 c/doz (MW)

55.02 c/doz (MW)

High

74.99 c/doz (CA)

74.78 c/doz (CA)

 

Components of 6-Region 1stCycle Cost of Production:-

 

MAY 2017

JUNE 2017

Feed

32.03 c/doz

32.00 c/doz

Pullet depreciation

10.75 c/doz

10.75 c/doz

Labor

4.00 c/doz

 4.00 c/doz

Housing

5.30 c/doz

 5.30 c/doz

Miscellaneous and other

7.86 c/doz

 7.84 c/doz

 

   
 

Export of Shell Eggs and Products, January-May 2017.

Jul 14, 2017

    

USDA-FAS data collated by USAPEEC, reflecting export volume and values for shell eggs and egg products are shown in the table below comparing the first five months of 2017 with the corresponding period in 2016:-

  

U.S. EGG EXPORTS FOR JANUARY-MAY 2017
COMPARED WITH THE CORRESPONDING MONTHS IN 2016

    PRODUCT

  Jan.-May 2016  

Jan.-May 2017

   Difference

Shell Eggs

 

 

 

Volume (m. dozen)

  50.2     

     46.5

 - 3.7      (-7.3%)

Value ($ million)

  50.7

     45.4

 - 5.3      (- 6.6%)

Unit Value ($/dozen)

    1.01

      0.98

  -0.03    (- 2.9%)       

Egg Products

 

 

 

Volume (metric tons)

   8,628

 18,318

 +9,690   (+112.3%)

Value ($ million)

     26.1

     47.1

    +21.0   (+80.5%)

Unit Value ($/metric ton)

   3,025

   2,571

    -454     (-15.0%)

 

Source USDA-FAS/USAPEEC

   
 

Togo Reports H5N1 Avian Influenza

Jul 14, 2017

    

The Togolese Republic, a nation of approximately 7 million in West Africa lying between Ghana on the west and Benin on the east has reported an outbreak of avian influenza strain H5N1 to the World Organization for Animal Health (OIE.)

In recent years, Ghana, Burkina Faso located to the north of Togo and Benin have reported outbreaks of avian influenza. The specific case involved an egg production farm of 35,000 birds located in the Maritime Region, according to a July 4th report in Reuters.

  

   
 

Danone to Divest Stonyfield

Jul 14, 2017

    

As part of an agreement with the U.S. Department of Justice, Groupe Danone of France will divest Stonyfield Farms, darling of the “organic set”, following acquisition of WhiteWave Foods.

The purchaser of Stonyfield, the Lactalis Group, generates sales approaching $20 billion annually in dairy products with 21 percent of revenue derived from the U.S. Stonyfield sales from organic yogurt and creams amounted to $370 million in 2016.

The Lactalis group will pay Groupe Danone $875 million for the Stonyfield business.

  

   
 

Fallout From $15 Per Hour Claims

Jul 14, 2017

    

Recently Greg Creed, CEO of YUM! Brands predicted that robots would replace many jobs in the fast food industry within ten years.

This forecast is based on technical developments by a number of companies. Miso Robotics of Southern California has developed a “kitchen assistant” to be marketed as Flippy, capable of cooking burger patties and placing them on buns. The demand for robotics has stimulated a number of companies in machine applications to develop equipment including Zume pizza, Café X and Frobot to prepare pizza, frozen yogurt, salads and drinks.

  

Despite increasing salaries, which now are in the region of $10 per hour, there is a 73 percent annual turnover in the QSR segment of the hospitality industry, according to the Bureau of Labor Statistics. Not only do restaurants have to recruit new employees to maintain crew levels, but they must also be trained at considerable expense.

According to a posting by Laura Kolodny on CNBC, Miso has managed to integrate robotic arms, sensors and machine vision coordinated by proprietary software to replace human workers. The company has raised $3.1 million from venture capital investors and anticipates placing Flippy units in Los Angeles stores operated by CaliBurgers during early 2018. Robert Stewart, president of Acacia Research noted “Robotics in the kitchen are an extension of going from the open flame to the oven and it is the next level in efficiency.”

   
 

Hillandale Farm Loses Layer House and Flock to Fire

Jul 14, 2017

    

A pre-dawn fire on Saturday, July 1st consumed a complete house with approximately 100,000 laying hens on a Hillandale of Pennsylvania farm in Heidlersberg, PA.

Approximately 30 fire companies responded to the call from Adams, Cumberland and York Counties. Prompt response prevented the fire from spreading to adjacent houses, but the affected unit is a complete loss. Replacement value for the barn, equipment and hens at current costs is estimated at $4.4 million including the flock.

  

There were no serious injuries among the first responders and the cause of the fire has yet to be determined.

   
 

UEP Future Leader’s Conference

Jul 14, 2017

    

The Fifth UEP Future Leaders conference was held at Stowe Mountain Lodge, VT. on June 19-22, with 35 attendees from the egg industry.

The agenda focused on effective communications, media training, best practices for critical conversations, coaching and mentoring, strategic planning made simple, and the seven habits of highly effective UEP committee members.

 

UEP set the stage with real-life examples of bowling alone. A key concept was understanding the importance of successful social interaction throughout the egg industry and to collaborate as young leaders. Henning Companies was proud to co-sponsor the event.

Pictured above (L-R): Mike Kreher (Kreher Family Farms), Lisa Beohm (Iowa Cagefree),
Oscar Garrison (UEP), and Matt Dean (Versova Holdings, LLC)
at the treetop adventure course during the team building activity.

 

 

(SMS 1,080-17 July 10th 2017) Henning and UEP logos.

   
 

USDA - WASDE FORECAST #567, July 12th 2017

Jul 14, 2017

    

Overview

The July 12th 2017 USDA WASDE projections for the 2017 corn and soybean crops reflected planting data and estimates of yield based on crop progress. Harvest areas for corn and soybeans were raised from the June Report to 83.5 million acres (86.7 million in 2016) and 88.7 million acres (82.7 million in 2016) respectively.

The USDA projected corn and soybean yields were unchanged at 170.7 bushels per acre (174.6 bushels in 2016) and 48.0 bushels per acre (52.1 bushels in 2016). Ending stock for corn was increased for July and projected at 2,325 million bushels (2,110 million in June WASDE Report) and for soybeans down 7.1 percent to 460 million bushels (495 million in June 2017 WASDE Report).

  

Corn

The projection of the corn harvest was increased from June attaining 14,225 million bushels, down 6.0 percent from 2016. None of the major categories of use were appreciably changed. The projected USDA range in farm price incorporated an 80 cents per bushel spread as is normal for a mid-year report with many uncertainties relating to weather ahead. Price was reduced by 10 cents per bushel on both ends of the range in the June WASDE Report to 290 to 370 cents per bushel. At noon on July 12th, CME quotations for July and September 2017 corn were 390 cents and 400 cents per bushel respectively.

The RFS for 2016 was belatedly determined to be 18.11 billion gallons by the EPA on November 30th 2015 (See Editorial in CHICK-CITE). The value was four percent higher than the May 2015 proposal of 17.4 billion gallons. The RFS declared by the EPA is currently the subject of litigation. It is doubtful that the incoming Administration will alter existing RFS levels given support of the Midwest agricultural sector to the 2016 election outcome and subsequently reinforced by Administration assurances to Corn-State legislators in early January 2017. A wild card will be the influence of the incoming EPA Administrator and the Secretary of Energy, both of whom favor the oil and refining industries of their home states.

Both officials have historically opposed the RFS. Business associates of the President-elect have recently commented negatively on the system of Renewable Identification Numbers (RINs) which affect the profitability of many domestic refineries. For 2017, USDA raised diversion of corn to ethanol by 50 million bushels to 5,500 million bushels or 33.0 percent of the harvest. It is acknowledged that this value  will allow for approximately 1,650 million bushel corn-equivalents of DDGS. The Heritage Foundation recently issued a report on energy policy, strongly questioning the environmental and economic benefits from the U.S. biofuels program considered to be replete with unintended consequences. The report recommended revocation of the RFS and allowing free market influences to determine the supply of biofuels.

The prevailing but stable historically low oil price reflects a slowing of World economic activity and increased oil and gas production in North America. Supply is a function of apparent restricted output from Saudi Arabia, lower production from Nigeria and Venezuela, resumption of supply from Iraq and Iran, and turbulence in the Mideast. Reduced output according to an OPEC “agreement” in early December 2016 and subsequent negotiations between OPEC and Russia are all contributory factors, determining the balance between supply and demand. This is important to the livestock industry as oil price is correlated to grain prices. The WTI fluctuated in a narrow range of $47 to $52 per barrel during June.

   
 

New CDC Director Named

Jul 14, 2017

    

Tom Price, the Secretary of Health and Human Services has announced that Dr. Brenda Fitzgerald will serve as the next Director of the Centers for Disease Control and Prevention.

She succeeds Dr. Tom Frieden who resigned in January after an eight-year tenure.  Dr. Anne Schuchat has served as Acting Director since the advent of the 2017 Administration.

Dr. Fitzgerald, aged 70, was an obstetrician in private practice for over 30 years.  She was appointed by Governor Nathan Deal to head the newly formed State Public Health Department in 2011.

A review of her credentials does not suggest any specific qualification to head the most important disease prevention agency in the World.

  

Brenda Fitzgerald

She has no post-graduate training in epidemiology, pathology, statistics or related disciplines, nor has she published in areas critical to the function of the CDC. Her appointment appears to be based on her post-clinical political activities in the state of Georgia and her association with Dr. Tom Price who served in Congress before appointment as Secretary of HHS.

   
 

Russia Extends Ban on Food Imports From Western Nations

Jul 14, 2017

    

The Government of Russia has announced that a decree signed by President Vladimir Putin extends the 2014 ban on specific foods and agricultural products produced by western countries through the end of 2018.

The ban was instituted as a reaction to E.U sanctions imposed on Russia following occupation of the Crimea and support for dissidents in the Eastern Ukraine. Nations affected include the 26 members of the E.U., Canada, Australia, New Zealand, Ukraine, Albania, Montenegro and Iceland.

  

Vladimir Putin

   
 

Status of 2017 Corn and Soybean Crops

Jul 12, 2017

    

The USDA Crop Progress Report released Monday July 10th  recorded progress in corn and soybean progress and condition similar to 2016 as expressed in the table below:-

 

                                                                            WEEK ENDING

Crop

July 2nd

July 9th

5-Year Average

Corn and Soy Emerged

         100

         100

          100

Corn Silking

           10

           19

            27

Soybeans Blooming

           18

           34

            32

Soybeans Setting Pods

                        

            7

             5

 

Crop

V. Poor

Poor

Fair

Good

Excellent

Corn Condition

     3         

   7

 25

  52

     13

Soybean Condition

     3

   8

 27

  54

     10

 

Parameter

v. Short

Short

Adequate

Surplus

Topsoil moisture:  Past Week

    13

   24

56

 7

                              Past Year

7

22

63

 8

Subsoil moisture:  Past Week

9

   22

63

 6

                              Past Year

6

21

67

 6

 

   
 

Hen Numbers Increase Slightly but Prices hold after Pre-July 4th Rise.

Jul 7, 2017

    

OVERVIEW

According to the USDA Egg Market News Reports posted on July 5th the Midwest wholesale prices for Extra Large and Large sizes increased by 5 percent from the previous week. The market will be influenced by hen inventory on the supply side of the equation. The progression of prices during 2017 is depicted in the USDA chart reflecting three years of data, updated weekly.

  

The July 5th USDA Egg Market News Report documented a USDA Combined Region value of $0.67 per dozen delivered to warehouses. This price lags Midwest Weekly values by one week, and is compared to a trailing peak price of $2.20 per dozen in late November 2015.  The USDA Combined range for Large, in the Midwest was $0.63 per dozen. At the high end of the range, the price in the Northeast Region, attained $0.70 per dozen. The current USDA Combined Price was approximately 55 cents per dozen below the three-year average. During the first Quarter of 2016 the average was inflated by the rise in prices attributed to the post-HPAI shortage of all eggs.

The number of producing hens this week was 0.3 million higher at 304.1 million as producers removed flocks held over going into the long weekend, after relative stability over the previous three weeks. The population is at a high level relative to demand. The total egg-flock comprises 311.6 million including hens in molt and small flocks

Generic shell-egg stock fell by 4.3 percent compared to a rise of 0.9 percent for the previous week confirming fluctuation in the balance between demand and production. Dried-egg inventory amounted to 28.0 million pounds (12,723 metric tons) as of May 31st 2017. This is extremely high, as is the National stock of frozen egg products reported on June 22nd confirming a stock of 39.5 million pounds (17,936 metric tons) on May 31st down from 41.2 million pounds on April 30th

 

   
 

mcr-1 Resistance Gene Identified in Australia

Jul 7, 2017

    

Following the emergence of the mcr-1 plasmid-associated gene imparting drug resistance to human bacterial pathogens in China, this gene regarded as the “smoking gun” for transmission of drug resistance from livestock to humans has emerged in E. coli in other nations.

A recent report* documents two clinical cases identified in Australia. The mcr-1gene was carried on the Incl2 plasmid. The authors attributed the geographically and epidemiologically unrelated identifications to introduction of the gene into Australia since neither patient had travelled beyond their state of residence. Identification followed a structured surveillance program.

  

E. coli Isolates from the patients were resistant to gentamicin, amoxicillin, cefotaxime, trimethoprim and ciprofloxacin denoting the range of antibiotic resistance associated with the gene. 

*Ellem, J. A. et al Locally Acquired mcr-1 in Escherichia coli, Australia, 2011 and 2013. Emerging Infectious Diseases 23: 7. 1160-1162 (2017)

   
 

Cold Chain Issue with Egg Exports to Mexico

Jul 7, 2017

    

Cesar Quesada the president of the Mexican Association of Poultry Producers (UNA) is opposed to imports of shell eggs from the U.S. He claims that table eggs are not held under refrigeration after they enter Mexico.

It is ironic that locally produced eggs are not refrigerated but in an apparent attempt at mitigation Quesada claims that these eggs reach the consumer within three days of lay.

  

There is also criticism that producers in Mexico are repacking U.S. eggs under labels of local brands. This is not credible since eggs exported from producers in the U.S. are stamped with a “US” imprint identifying the nation of origin.

It would appear that the UNA is sensitive to competition but the organization should attempt to promote domestic product by ethical and acceptable publicity. For the first four months of 2017, Mexico imported 3.9 million dozen table eggs valued at $3.97 million. Imports from the U.S. represented a 55 percent increase in volume and 38 percent increase in value over the corresponding four months in 2016.

Mexico has sharply increased imports of egg products with 2,060 metric tons shipped during the period January through April 2017 valued at $4.0 million. Volume increased by 109 percent and value by 67 percent over the corresponding period in 2016.

   
 

Twinpack Special Products Introduces New Egg Crate

Jul 7, 2017

 

    

A new design featuring unique closing, and ease of washing is available in the Twinpack EggsCargo® System. The crate is engineered for ergonomic filling and emptying and is constructed of durable material.

For further details access the Twinpack website by clicking on the EggsCargo® logo on the right of the Welcome page.

   

   
 

USDA DATA ON CAGE-FREE PRODUCTION

Jul 7, 2017

    

Based on the growing importance of cage-free production, the USDA-AMS issues a monthly report on volumes and prices for the information of Industry stakeholders.

EGG-CITE will summarize and comment on data and trends in this monthly Cage-Free Report, supplementing the information presented weekly in the Production and Pricing Report.

  

The report for the month of June 2017 released on June 30th 2017 noted that there was no increase in either organic or cage free flocks after a 0.7 percent increase for organic and 2.6 percent for cage-free flocks respectively in May although average flock production advanced to 75.5 percent :-

 

Flock Size (million hens)

June ‘17      May ‘17

Certified Organic

14.6                 14.6

Cage-free hens

27.3                27.3

Total non-caged

 41.9                41.9

 

Rate of lay   75.5 percent

 

Average weekly production (1,000 cases)

Certified Organic

214,336      up   0.3%

Cage-free

400,779      up   0.3%

Total non-caged

615,115      up    0.3%

 

Average Wholesale Contract Price C-F, L. Brown

$1.60/doz. (down 4.0 cent)

Range  (down on the low end by 29 cents from May)

Average FOB spot price, nest run

$1.16 to $2.00/doz.

$0.35 to $0.90/doz. Average $0.61/doz.

 

Average Advertised National Retail Price C-F, L, Brown

$3.17/doz.

USDA 6-Region (only 3 reporting)

High S. East)

$3.49/doz.

 

Low (Midwest)

$2.43/doz.