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Free–Range Markets Must See Price Increase

7 March 2012, at 10:08am

UK - Free range egg producers need to see a significant and immediate increase in the price they receive to maintain supplies in the long-term, the National Farmers' Union (NFU) said today.

Free range producers have struggled for 18 months amid a background of rising costs, low egg prices and oversupply in the free range market. However, since January 1 and the introduction of the Welfare of Laying Hens Directive, egg supplies have tightened across the UK and Europe, leading to increases in the price of cage and barn eggs, but as yet no corresponding move in the free-range market.

NFU poultry board chairman Charles Bourns has called on the supply chain to recognise the seismic shift that is taking place right now in the egg market and to ensure that the British free range egg industry retains its ability to invest in the future.

“Egg producers have responded to both legal requirements and market demand over the years by converting to new enriched cages and free range production, making significant investments in the process,” he added.

“Many have borrowed serious amounts of money to invest in new buildings in the run up to the conventional cage ban. Producers have been struggling to meet capital repayments and run profitable businesses. We know the market has been affected by oversupply until recently, but there are very clear signs it is now on the turn.

"Free range producers need to see a significant increase in the price they receive that reflects the cost of production and allows future investment and innovation in businesses in the future. As it stands, the majority are making a loss and this is now unsustainable.

“British egg producers have made genuine financial and professional commitments to delivering what consumers want in terms of higher welfare egg production. Now is the time to see those commitments repaid by the rest of the supply chain.

“Retailers in particular need to think about the long term security and future supply of British free range eggs and avoid the risk of irreparable damage being done to the free range egg supply base by not getting the market signals right now.”