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Conversion to Cage-Free in Australia Has Lesson for the U.S.

  

Jan 13, 2017

    

In recent weeks, commentators have questioned the extent and rate at which the U.S. egg industry will convert from conventional cages to alternative housing systems, presumably with aviary units predominating. Reference to conversion in other egg industries can provide perspective relevant to our own situation.

In an article which appeared in an Australian publication The Weekly Times on January 5th, the Australian Egg Corporation indicated that the proportion of caged and non-caged eggs is now at parity representing a change from 75 percent caged-eggs marketed in 2007.   

  

Virtually all the supermarket chains in Australia (Aldi, Coles and Woolworths) have committed to sourcing cage-free eggs, paralleling commitments from QSRs (Subway and McDonald’s) and food service providers. The rate of conversion is expected to accelerate through the remainder of the decade. It is estimated that the Australian population of 23 million annually consume 270 eggs per capita representing a potential hen population of 22 million.

This will require re-housing of 11 million hens to either barns or range this decade. Given previous exposure to LPAI H7N2 avian influenza, carried by migratory birds affecting a NSW free range farm in 2013, (See EGG-CITE October 18th 2013), the popularity of non-confined flocks may evaporate in the event of introduction of HPAI H7N6 or other Eurasian strains.

The second issue of concern relates to confusion in labeling of eggs in Australia with conflicts over the definition of “free-range” (See EGG-CITE December 23rd 2016) with the Federal government imposing a national standard of 11 foot2 per hen. (See EGG-CITE April 8th 2016). The CEO of the RSPCA of Australia, Heather Neil stated “international experience shows it’s only a matter of time before battery cages are relegated to the past.”

It is clear that standard nomenclature will have to be applied to U.S. eggs derived from flocks housed under a variety of systems.  This question of labeling should not be delayed as egg producers transition to alternatives from cages. The industry should take the lead in defining specific terms including “free-range”; “aviary”; “pastured”; “barn-housed” and other appelations. 

Not only the descriptive terms but the artwork on cartons will require regulation.  A number of years ago a broker in New England, sourcing eggs from conventional barns, labeled product as “free roaming” When combined with label graphics depicting hens on pasture, any reasonable consumer would assume that eggs were from a “free-range” flock. The intent was to deceive purchasers at the expense of competitors.  In Australia there is currently a six to ten fold difference in actual space requirements for hens, all legally described as “free-range” with the lowest outside space allowance of eleven foot2 per hen.

We can guide our trajectory on conversion from conventional cages by observing the rate of adoption of alternative systems in other industries. We need to analyze and understand the capital and operating costs of production, market demand, price differentials at the shelf, and price elasticity and relative volumes associated with different systems of housing and equipment.