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Why cage-free eggs could be on shaky ground

Why cage-free eggs could be on shaky ground
Why cage-free eggs could be on shaky ground


Several states and retailers set 2026 as the deadline for egg producers to transform their operations to cage-free systems, a move that many saw as what consumers wanted. But egg farmers say they need more time. 

A study published in February by the FMI Foundation and United Egg Producers pointed to the high cost of upgrading facilities to accommodate cage-free production as hampering the transition. Cage-free machinery, particularly aviary systems that allow for increased movement space, can cost over $40 per bird

“Because of the dollar investment that is required to move that way, it’s not moving at a fast pace,” said Kenneth Anderson, a commercial layer and small flock management professor at North Carolina State University’s Prestage Department of Poultry Science

When the conversion to cage-free production began in earnest in 2014, Anderson said experts estimated that it would cost the industry roughly $10 billion. The cost already has outpaced this figure, he said.

Long advocated for by animal welfare activists once food companies, such as Nestlé and Conagra — along with retailers, such as Whole Foods and McDonald’s — made pledges about a decade ago, a shift to a national cage-free egg production system seemed imminent.

At least nine states — from California to Massachusetts and Utah — passed laws requiring all egg-laying hens to be housed in cage-free environments by 2024 and 2026. California’s 2018 ban took effect last year. 

After California’s law, known as Proposition 12, took effect, egg prices in that state increased dramatically. Californians paid $5.62 for a dozen eggs in early February, compared to $3.05 for non-cage free eggs in the Midwest, according to The Wall Street Journal

Research published in the American Journal of Agricultural Economics projected the law will result in an annual loss of $23 million for consumers in the state.

And with another outbreak of the highly pathogenic avian bird flu (HPAI), conversations about eggs across the U.S. center around cost as egg prices jumped astronomically in the last year. Accusations of price gouging from consumer advocacy groups have called the motives behind price increases into question and have accused some companies of taking advantage of the bird flu situation.

Prices of eggs at the grocery store jumped 70.1% in January compared to 12 months prior, according to the most recent Consumer Price Index from the U.S. Bureau of Labor Statistics. The price of a dozen extra large brown cage-free eggs was $4.79 as of Feb. 1, according to the USDA, compared to $2.66 the same time a year ago.

 

hens eggs cage-free

Optional Caption

Courtesy of Humane Society

 

What could help cage-free make its deadline?

In the FMI study, egg producers offered that the biggest limiting factor to the adoption of cage-free production is capital. 

Overall costs of cage-free production are estimated between 8 and 19% more than non-caged, which includes additional labor costs.

FMI and United Egg Producers found that while many states have deadlines of 2026, it may take longer for the whole country to adopt the practice. Extending the deadline, along with government assistance, could allow more time for the industry to construct the needed facilities and acquire the necessary operational equipment, the study authors said.

Major retailers, such as Walmart and Kroger, already have backed out of their commitments to supply 100% cage-free eggs by 2025.

After California’s cage-free law, known as Proposition 12, took effect, egg prices in that state increased dramatically. Californians paid $5.62 for a dozen eggs in early February, compared to $3.05 for non-cage free eggs in the Midwest, according to The Wall Street Journal

Research published in the American Journal of Agricultural Economics projected the law will result in an annual loss of $23 million for consumers in the state.

Currently cage-free eggs make up 34.6% of the total egg-laying flocks in the U.S., according to WATT Poultry. Half of U.S. egg-laying hens are predicted to still be housed in cages in 2025 — and it’s unlikely that 100% will be cage-free by 2040 — according to producers surveyed by the egg industry outlet.

Some companies are holding off on adopting cage-free systems because many consumers are not willing to pay the premium prices for the eggs, Anderson said.

“Consumers vote with their pocketbook,” Anderson said. “And their pocketbooks are saying we don’t need as many cage-free eggs.”

 

Vital Farms eggs and cooked in Vital Farms butter

Optional Caption

Courtesy of Vital Farms

 

How pork is getting involved

A contentious federal court case also could impact the speed at which the industry pursues its cage-free goals Last fall, the U.S. Supreme Court heard oral arguments in a challenge to California’s Proposition 12. 

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