UK egg supplies tighten: Trade body warns “volatility is out of their control,” as farmers face price pressures

10 Nov 2022 --- Egg farmers are reducing their flock sizes due to increasing costs making their businesses unfeasible, the British Free Range Egg Producers Association (BFREPA) has warned, flagging that many of its members are losing money due to high chicken feed prices and energy costs.

Farmers have called for a £0.40 (US$0.46) increase for a dozen eggs to help meet costs. They also claimed that despite the price of a dozen eggs rising by £0.45 (US$0.51) in supermarkets since March, they’ve only received between £0.05 (US$0.057) to £0.10 (US$0.11) of that increase.

The association revealed in a survey that 33% of its members had either reduced or paused production of egg farming in some way.

Ben Pike, a spokesman for the trade body, says bird flu was a “contributing factor” in egg farmers struggling,” and also highlights how pressure from prices was “probably a greater factor at the moment.”

BFREPA revealed that 33% of its members had either reduced or paused production of egg farming in some way.Speaking to FoodIngredientsFirst, Pike says UK companies should talk to their suppliers about the reasons why egg supply has tightened. “Question whether the price farmers are paid is sustainable for the long term, allowing them to have the confidence to keep farming and, in turn, maintain a steady supply of eggs to the market.”

“In the short term, there is very little evidence that the cost of producing eggs will fall,” he continues. “Producers will of course hope for a return to lower prices but need to be paid according to market fluctuations as this volatility is out of their control.”

Pike flags how it is “almost impossible to predict how long this could be an issue.”

“Supply is tighter in November as companies and consumers buy more eggs to prepare Christmas food, but even after that demand fluctuation there is still the underlying issue of unsustainable farm gate prices and the threat of avian influenza taking more egg-laying birds out of production.

“Up to 50% more expensive”
According to a statement on its website, BFREPA says that “Feeding hens is now at least 50% more expensive than it was, and energy prices have soared in the same way that consumers have seen their domestic bills rise. Spending on fuel has grown by 30%, while labor and packaging also cost more.”

“Many of our members are losing money on every egg laid, and our data shows that even those making a small profit do not see a long-term future.”

“Fewer hens means fewer eggs, and in March we warned that eggs could be in short supply by Christmas. Availability naturally tightens at this time of year as businesses and individuals prepare for Christmas, which may be exacerbating the situation.”

“We need to see farmers get paid a sustainable price to restore confidence and optimism to the sector,” the association underscores. 

Soaring costs impact and other factors impact sectors 
Egg farmers have also been hit by soaring energy costs in recent months. They have had to pay more for wheat, a key ingredient in chicken feed, which has spiked due to the Ukraine war, with Russia and Ukraine producing about 30% of the global supply.

As well as rising costs, farmers have been hit by the UK’s largest avian influenza outbreak, leading to millions of birds being culled in the past 12 months.Farmers have warned the UK could face an egg shortage if retailers do not start paying more.

According to government guidelines, all poultry and captive birds in England are required to be kept indoors, which has meant eggs in shops being labeled as “barn eggs” due to birds being kept inside for more than 16 weeks.

Farmers have warned the UK could face an egg shortage if retailers do not start paying more.

In contrast, the Department of Environment, Food and Rural Affairs said there was “currently no shortage of eggs.”

“We understand the difficulties the bird flu outbreak is causing farmers. However, the laying hen population is approximately 38 million, so it’s unlikely to affect the overall supply,” a statement reads.

Meanwhile, Kevin Coles of the British Egg Industry Council believes there are issues regarding egg availability, but he notes didn’t think it was a so-called “crisis.”

“There are a lot of pressures on farmers at the moment, avian influenza being one, costs another, and demand remains strong – consumers want to buy eggs,” he adds.

The British Retail Consortium (BRC), which represents supermarkets, said bird flu had caused some disruption to egg supplies but added retailers were trying to minimize the impact on customers.

“Retailers have long-standing, established relationships with their suppliers and know how important maintaining these are for their customers and businesses,” explains Andrew Opie, director of food and sustainability at the BRC.

Supermarkets source most of their food from the UK and know they need to pay a sustainable price to egg farmers. However, he warns that they are constrained by how much additional cost they can pass onto consumers during a cost-of-living crisis. 

By Elizabeth Green