Egg restaurant chain absorbing costs from AI outbreak

While the avian influenza outbreak is pushing up the prices of eggs, it is adding financial pressure to restaurants that specialize in serving egg dishes. However a managing partner for Jimmy’s Egg, an Oklahoma City-based chain, said he believes the price hike will be temporary so the chain will absorb the costs.
Morrie Sheets, a managing partner of five Jimmy’s Egg restaurants in Wichita, Kansas, told KAKE he has observed prices for a case of of 30 dozen eggs has gone up each of the past two months, and he predicts that price will go up again for another month.
And while that will be a burden for the restaurant, Sheets does not want to burden Jimmy's Egg customers, who would have to pay an extra 30 to 40 cents per plate to offset the increased cost of eggs. Sheets said he sees high egg prices as only a temporary problem as U.S. layer flocks affected by avian influenza will be repopulated.
“We think it’s going to be done in the next 30 to 60 days. We’ll see the cycle run through,” he said.
Jimmy’s Egg has locations in Oklahoma, Kansas, Texas, Nebraska and Missouri, according to the company website.
Bookmark WATTAgNet’s avian influenza update page to keep informed on avian influenza’s impact on the U.S. poultry industry.

Midwestern egg prices jump in wake of avian influenza

• 

  Andrea Gantz

  Midwestern Egg prices have increased about 17 percent since avian influenza cases have hit layer flocks in the region.

  From WATTAgNet:
  Prices for eggs have been increasing in the Midwest as the region’s poultry farmers deal with cases of avian influenza, which have led to the deaths and stamping out of millions of layer hens.
  According to reports, the price of a carton of large eggs in the Midwest is now about $1.39, an increase of about 17 percent.
  More than 24 million hens have been lost as a result of avian influenza outbreaks in Iowa and other nearby states. In one case, a layer flock of 5.3 million in Osceola County, Iowa, was affected by avian influenza. The most recent case was confirmed on May 12 in Dixon County, Nebraska, where samples from a layer flock of 1.7 million tested positive for H5N2 avian influenza.
  While the reduced supply of hens and subsequent reduction in egg supply has caused a price increase, a May 8 report issued by Iowa State University business analyst Maro Ibarburu stated that it may be too early to truly tell what kind of impact the avian influenza outbreak will have on wholesale egg prices, citing that even though the egg supply has dropped, other factors may shift the demand for eggs, including domestic and export market considerations that may counter the supply impact on price.
  To track confirmed cases of the North American avian influenza outbreak, see WATTAgNet's avian influenza tracker map and bookmark the avian influenza update page for news about and analysis of avian influenza.

Sparboe Farms' egg pricing legal battle settled

A six-year legal battle involving a group of grocery chains and food vendors accusing egg producer Sparboe Farms of taking part in a scheme to hike prices on eggs has ended. The group of vendors has dropped its claims against the egg producer, while Sparboe Farms has dropped its claims that it was subjected to unwarranted boycotts.
U.S. District Judge Gene Pratter on June 18 signed off on the case. It is not known whether any money was exchanged between the two parties to get the litigation dropped, but both parties have agreed to pay their own legal fees and court costs.
With the legal allegations in the past, Sparboe, through its attorney, has reaffirmed that it did nothing illegal or immoral.
“Sparboe disagrees with the viability of plaintiffs' claims against Sparboe, denies any liability to plaintiffs and denies that it engaged in any improper or illegal conduct," Troy Hutchinson, an attorney representing Sparboe Farms, told Law360. "Sparboe is pleased to put the litigation behind it."
Companies involved in the litigation against Sparboe Farms included Safeway, SuperValu, Kroger, Hy-Vee, Albertson's, The Great Atlantic & Pacific Tea Co., H.E. Butt Grocery Co., Conopco., Giant Eagle Inc., Publix, Winn-Dixie, Roundy's Supermarkets, H.J. Heinz Co., C&S Wholesale Grocers, Kraft Foods Global, General Mills, Nestle USA, Kellogg Co. and Walgreen Co.

US table egg production up in October

The U.S. table egg laying flock in October was estimated at 288 million hens, 2.2 percent above 2011 numbers, according to the U.S. Department of Agriculture's latest report.
The number of hens in the table egg flock on a year-over-year basis was higher throughout the first 10 months of 2012. With higher hen numbers, the number of table eggs produced has increased. In October, table egg production was 574 million dozen, an increase of 2.2 percent from 2011, said the USDA. Table egg production on a year-over-year basis has been higher in every month so far in 2012.
Overall table egg production in the first 10 months of 2012 was 5.5 billion dozen, an increase of 1.3 percent from the same period in 2011. The table egg flock and table egg production are expected to be at higher levels than in 2011 through the remainder of 2012. At the beginning of November, the number of birds in the table egg flock was 291 million, up 2.5 percent from 2011 numbers, and table egg production is expected to total 1.72 billion dozen in the fourth quarter of 2012, up 2 percent from 2011.

U.S. egg prices
Even with larger table egg production, wholesale prices for eggs have continued to be strong, according to the USDA. The fourth-quarter 2012 wholesale price for one dozen Grade A eggs in the New York market is expected to average $1.30 to $1.33, roughly the same as in 2011. At the beginning of December, wholesale prices for Grade A large eggs in the New York market were approximately $1.38 per dozen.

Hatching egg production
Hatching egg production was lower than 2011 numbers throughout the first 10 months of 2012, according to the USDA report.

With lower broiler production, the decline in hatching egg production has largely been due to significantly lower production of meat-type hatching eggs in every month compared with 2011. Over the first 10 months of 2012, production of meat-type hatching eggs was 4 percent lower than in 2011, while the production of egg-type hatching eggs was 1 percent higher. Decreased production of meat-type eggs is expected to continue into the first half of 2013 until broiler integrators begin to expand production.
For more information and statistics on U.S. egg production, see www.wattagnet.com/marketdata.html.

Mexico egg prices remain high after avian influenza outbreak

Mexico is considered to have the greatest per-capita consumption of eggs in the world, and the high level of egg consumption coupled with the production decrease and highly pathogenic avian influenza-related market speculation have pushed egg prices higher for all major population centers, according to the U.S. Department of Agriculture.
Mexico's poultry and egg industry organization, UNA, reported that industry members attempted to maintain supplies and dampen the price spike by reducing or eliminating egg and egg product exports while also extending egg-layer production cycles to between 125 to 128 weeks. Still, prices more than doubled during the outbreak and are still hovering more than $0.50 per kilogram greater than the same period in 2011, whereas U.S. egg prices in dollars per dozen are virtually unchanged from 2011 numbers. In response, Mexico opened its market more broadly to imported eggs.
Most egg imports as a result of the avian influenza outbreak did not get into full swing until September. U.S. shell egg exports to Mexico totaled 1.998 million dozen for January–August; in September alone the U.S. exported 7.89 million dozen eggs.
Mexican authorities and industry members indicate that egg prices have stabilized, albeit at levels greater than before the outbreak. The pre- and post-incident prices are considerably different in Mexico, while prices in the U.S. are similar to 2011, according to the USDA. In addition to disrupting the general supply and demand of Mexico’s egg market, escalating prices pushed Mexico’s Foreign Trade Commission, COCEX, to refrain from imposing anti-dumping duties on imported U.S.-origin chicken leg quarters. U.S. chicken leg quarters remain a low-cost protein source for many Mexican consumers and are much cheaper than their Mexican equivalents, as feed grain input costs and consumption preferences between the countries differ significantly.

Israel government prevents egg shortage, agrees to price increase

Israel's government has prevented an egg shortage by agreeing to a 5.5 percent per-egg price increase, according to reports, raising the price for a carton of one dozen eggs to between NIS 11.76 (US$3.02) and NIS 14.06 (US$3.61), according to reports.
Prior to the increase, consumers paid NIS 11.10 (US$2.85) for medium-sized eggs, NIS 12.25 (US$3.14) for large eggs and NIS 13.40 (US$3.44) for extra large eggs. The Israel Poultry Breeders Association stopped providing eggs to local supermarkets on November 4, saying that high chicken feed pricing were making it too difficult for them to profit at current prices.
The price increase was authorized by Attorney-General Yehuda Weinstein, who was asked to rule on the decision by Finance Minister Yuval Steinitz and Agriculture Minister Orit Noked.

India egg prices decreased to raise consumption

India's National Egg Coordination Committee in the Namakkal zone has effected a 15-paise cut in egg prices, from the already decreased April 2–6 price of Rs 2.30 (US$0.04) per egg, to encourage domestic consumption and to normalize an overflow of stock resulting from an Oman-imposed ban on the import of poultry products from the country.
Oman imports one-third of India's poultry exports, and the industry has resorted to price slashing to avoid building up inventories over the summer. Namakkal accounts for nearly 95 percent of India's egg exports. A drop in egg prices is not entirely unexpected approaching the summer months, as an increase in temperature usually results in decreased consumption in the country, according to P. Selvaraj, chairman of the National Egg Coordination Committee.

US consumers paid more for poultry, eggs in 2011

According to the Bureau of Labor Statistics' Consumer Price Index Summary, released December 16, U.S. consumers paid more for food, including poultry meat and eggs, overall in 2011. The index for “food at home” rose 5.9% over the past 12 months, with “all six major grocery store food groups up at least 4.4%.” The six major grocery store food groups are: cereal and bakery; meat, poultry, fish and eggs; dairy and related food items; fruits and vegetables; non-alcoholic beverages; and other food at home. The index for “food away from home,” or food purchased from fast-food or full-service restaurants, rose 2.9% in 2011, unadjusted for the seasons, according to the BLS. Ricky Volte, research economist with the U.S. Department of Agriculture, said that weak economic growth has driven more consumers to purchase food at the grocery store rather than going out to eat, increasing demand and, subsequently, prices for “food at home.” 

India egg prices rising on bad weather, production cuts

Egg prices are rising in India as the onset of winter, recent torrential rains and a cut in production has affected numbers across the country, according to reports.
Eggs currently stand at Rs 2.88 (US$0.06) a piece. During the same time in 2010, they climbed only slightly higher, to Rs 2.90 a piece.
Layer prices, on the other hand, have gone down, according to the National Egg Coordination Committee, to Rs 41 (US$0.83) per kilogram. Broiler prices are also expected to drop in coming days. “We want to increase the prices gradually," said an NECC spokesperson. "If we raise the prices, we may face consumer resistance and piling up of stocks."

UK egg producer website campaigns for fair prices

UK egg producers now have a new website, Egg Producers Together, aimed at uniting farmers to campaign for fairer prices and to raise awareness of the difficulties they face.
According to free range egg producer Ian Chisholm, who set up the portal, UK egg producers have the opportunity to work together to change the way the industry operates and negotiate fairer deals for farmers. “We urgently need the government and the Competition Commission to take another look at the way the egg industry operates," said Chisholm. "There is just not enough competition and some of the packers have a stranglehold on egg production, which is forcing payment to egg producers down lower than the cost of actually producing those eggs.” 

Eggs from enriched cages may cost up to 17% more than conventional

The cost of eggs produced in enriched cages, such as this JS West enriched colony system, is higher than that of conventional cages, a study from the company shows.

The cost per dozen eggs produced in enriched cages is 15% to 17% higher than in conventional cages, according to Tom Silva of JS West.
Silva, who spoke at the Egg Industry Issues Forum hosted by the Egg Industry Center of Iowa State University, said the enriched system requires a premium of 10 to 12 cents per dozen to compensate for additional costs.
JS West studied its 151,200 hens housed in enriched cages and compared these birds' results with hens in conventional battery cages through 50 weeks of age. To 50 weeks of age, hen-housed egg production for the two systems was 197 and 191 for the enriched and conventional cages, respectively, with mortality attaining 1.4% and 0.9%. Average production for the period 20 through 50 weeks was 89.4% for enriched cages and 88.3% for conventional cages.
Feed intake per dozen attained 3.7 pounds for the enriched system and 2.94 pounds in conventional cages. Since body weight for the two groups were 3.45 pounds and 3.47 pounds, respectively, inferior feed conversion in enriched cages is attributed in part to increased movement and to the average case weight of 48.8 pounds for enriched cages and 47.0 pounds for conventional batteries.
This system, supplied by Big Dutchman International, along with similar installations, has received the seal of approval of the American Humane Association.

Thailand may suspend egg exports, freeze domestic prices

Thailand is considering a temporary ban on chicken egg exports coinciding with a freeze on domestic egg prices to help stabilize the market, according to government officials.
The ban, which could last up to six months if implemented, is a response to a recent drop in production and rising feed prices that have combined to significantly increase retail prices of eggs in the domestic market. Production has declined by 3 million eggs a day as a result of heavy floods that hit chicken farms in the southern part of Thailand, exacerbated by hot weather in other areas that caused poultry disease outbreaks resulting in layers' deaths, according to reports.
Thailand exports around 20 to 30 million eggs a month, according to the Hen-Egg Farmers, Traders and Exporters Association. Domestic consumption of eggs averages 25 million a day