Two-tier market for illegal eggs

A two-tier market is expected to emerge once the conventional cage ban comes in on 1 January 2012 and, as the price differential grows, so buyers will be more tempted to seek out non-compliant eggs.

According to a new report, commissioned by the British Egg Industry Council and timed to coincide with the start of British Egg Week (10-16 October), the vast majority of shell eggs on sale will carry the British Lion mark and will be 100% legal.

But a small proportion of imported shell egg will still go through wholesalers to small retailers, street markets and food service outlets which do not specify the Lion mark. “These outlets are more likely to provide an outlet for eggs from illegal cages,” says the report, which has been prepared by European Food and Farming Partnerships.

The study goes on to identify egg processors, food manufacturers and caterers as the other sectors “most likely to use illegal eggs”.

EFFP notes that many of these businesses have stated their intention to use legal eggs only from 1 January 2012. “In practice, however, consumers are less aware of production history and provenance for egg products and it would appear egg supply is more difficult to police.

“Whilst many food companies should be applauded for their support of producers who have invested to comply with the directive, such support will undoubtedly come at a cost,” it adds.

“As the likely price differential between fully traceable, compliant egg and egg traded outside these supply chains widens, commercial pressure to secure cheaper supply is likely to grow.”

The report explains that egg producers who have converted to the new enriched colony systems already face an 8% increase in their day-to-day running costs. “But the greatest impact will be on servicing the capital cost, namely interest and depreciation,” it adds.

“Producers do not expect the market to be tilted in their favour because of the investment they have undertaken. But if the market becomes artificially depressed due to egg imports that do not comply with the legislation, it will impact on egg producers who are having to cope with increased costs.”

Commenting on the report’s findings, BEIC chief executive Mark Williams called on the prime minister to support a ban on imports of illegal eggs.

“At a time when the UK’s economic health is paramount, we’re urging David Cameron to ensure that British egg production is not allowed to be undermined because of a flood of cheap, illegal imports from Europe.”

• What do other readers think of the impending cage ban? See our Poultry Platform forum thread.

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