California cage-free laws turn up heat on egg prices
A landmark animal-welfare law that takes effect in California on New Year’s Day to effectively abolish the close confinement of farm animals in cramped cages and crates has pushed egg prices to records recently.
Los Angeles Times (TNS)
LAKESIDE, Calif. — If your eggs seem a little pricier, consider the recent changes on Frank Hilliker’s ranch.
In the last six months, the third-generation egg farmer in San Diego County has reduced his flock by half and embarked on a $1 million overhaul of his henhouses to make them more spacious. Customers are now paying about 50 percent more for a dozen eggs from Hilliker’s family business, at around $3 a carton.
It’s all to comply with a landmark animal-welfare law that takes effect in California on New Year’s Day.
Voters overwhelmingly approved Proposition 2 in 2008 to effectively abolish the close confinement of farm animals in cramped cages and crates — a practice animal advocates say causes needless suffering and boosts the likelihood of salmonella contamination.
Already, the specter of California’s regulations is believed to be contributing to record prices for eggs.
The average wholesale cost of a dozen large eggs hit a peak of $2 on Thanksgiving Day — doubling in price from the start of November before settling this week to about $1.40. It comes at a time when soaring meat prices are expected to help push U.S. egg consumption to its highest level in seven years.
Adding to the pressure is increased demand for U.S. eggs in Canada and Mexico, where domestic poultry and egg industries are battling bouts of avian flu.
“It’s sort of a perfect storm,” said Ronald Fong, chief executive of the California Grocers Association, who doesn’t expect a significant egg shortage next month but is less clear about changes in retail prices.
California’s rules are rippling beyond its borders. No state consumes more eggs — and about a third of its supply must be imported.
Iowa, where laying hens outnumber people 2 to 1, sells about 40 million eggs a day to out-of-state buyers.
Under a separate bill signed by former California Gov. Arnold Schwarzenegger in 2010, all shell eggs arriving from other states must also comply with Proposition 2 by Jan. 1, 2015.
That requirement set off a barrage of lawsuits, including one from six leading egg-producing states. Missouri, Alabama, Iowa, Kentucky, Nebraska and Oklahoma invoked the constitution’s interstate commerce clause by arguing that California was interfering with their local egg industries.
The suit, which a federal judge dismissed in October, is being appealed.
“Egg producers have had six years to come into compliance with Prop. 2, and instead of using that time to convert to cage-free systems, they’ve simply sued and sued and lost every suit they filed while sitting on their hands,” said Paul Shapiro, vice president for farm-animal protection at the Humane Society of the United States, a leading proponent of California’s new regulations.
Consumers are increasingly looking for alternatives to conventional eggs such as pasture-raised (hens with access to the outdoors) and cage-free (birds still in barns, but not in battery cages). Those eggs can cost two to three times as much.
That hasn’t discouraged major corporations such as Burger King, Dunkin’ Donuts and Kraft Foods from pledging to invest more in cage-free eggs. Starbucks said last week it would phase out using eggs from battery cages.
At Hilliker’s ranch, 8,000 brown and white hens already roam a new 30-by 165-foot stainless-steel aviary.
The noisy birds cluck, drink and eat most of the day, perched on rafters or on one of three tiers that provide the animals more space. They also have access to the ground, where the birds typically like to scratch an itch.
“If there was no law, would I have done something? I don’t know,” Hilliker said. “Was I pissed when it passed? Yes.”
But the 46-year-old farmer wasn’t ready to give up a business that has been in the family since 1942.
Hilliker, who runs the operation with his sister, said he owns the last remaining egg farm in a formerly agriculturally rich area a half-hour drive from downtown San Diego. Tract homes increasingly encroach on the community.
“When the law passed, we had to do some soul-searching,” said Hilliker, a stout, plain-spoken man with lean pork-chop sideburns and, ironically, an aversion to breakfast. “We could have sold the land to development, become greeters at Wal-Mart and lived very comfortably.”
He resisted out of a sense of loyalty to his employees and their families. And he set out to comply with the new California rules by asking a bank for a new line of credit to pay for the retrofit.
Ever since, Hilliker has been startled by the change.
Now free to move around, his hens exhibit behavior he had never seen before — like a pecking order when it comes to feeding or their playful beak-tapping on old CDs and colorful string he’s hung from the beams.
“I don’t know if the chickens know any better, but it’s made farming fun again,” Hilliker said of the new barn. “It’s a new challenge, and I feel like it has reinvigorated me.”