Presentation to Agriculture and Rural Development Committee,

European Parliament

on 29th September 2010

The EU Egg Industry – Welfare of Laying Hens

EUWEP

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The Key Issues

• Egg Industry is working hard to meet full requirements of Council Directive 1999/74/EC by 1st January 2012– Legislation must be implemented, whilst avoiding problems

• Major producers most able to meet deadline on ban on Conventional Cages – Smaller producers unlikely to, or leave industry

• EUWEP has real concerns that rate of conversion to either enriched cages or non-cage systems of production is not happening fast enough to ensure full compliance across the EU

• If eggs produced by hens, which continue to be housed in a conventional cage, were precluded from being marketed from 1st January 2012, the result would be a massive egg shortage resulting in a significant increase in egg prices

• Need to ensure orderly move to either enriched systems or non-cage systems, to prevent market distortion

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Total 354.67 millionhens

Data from 26 member states

154.6m ‘other’ hens not included

EUWEPSource: EUWEP / from DG AGRI data

Updated on 28th May 2010

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Total 353.53 millionhens

Assumption

- Enriched cage growth to 30m hens

147.6m ‘other’ hens not included

EUWEPSource: EUWEP / from DG AGRI data

Updated on 28th May 2010

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Total 353.53 millionhens

29% of Laying hens non-compliant on 1st January 2012

Assumptions

- Enriched Cage hen numbers increase to 130m

- Barn increases to 70m hens

- FR increases to 40m hens

Source: EUWEP

EUWEP

Updated on 28th May 2010

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What is the likely consequence if 29% of EU hens remain in conventional cages on 1st January

2012?• Scenario 1 - Member states enforce legislation

• 83 million egg a day needing to be disposed of …• Leading to … an egg shortage of 83 million eggs a day!

But• this cannot be filled by imports from non-EU countries as currently

only Switzerland, Croatia and Norway authorised to export shell eggs to EU (due to EU’s Salmonella legislation)

• Prices to consumers would increase sharply

• In the medium term, EU production is likely to be replaced by imports of eggs and egg products produced to inferior animal welfare standards

• This would not benefit laying hen welfare, consumers, industry employment, cereal growers, the environment, EU food security, or the wider economy

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What is the likely consequence if 29% of EU hens remain in conventional cages on 1st January

2012?

• Scenario 2 - If more time is given to convert…

• If member states do not enforce legislation, or more time is allowed to convert from conventional cages …

• Then conventional cage production would continue …

• Causing widespread market disruption, severely affecting the viability of many (compliant) businesses as prices and therefore producer returns are depressed– This would affect producers in all systems of production - Cage,

Barn, Free Range, Organic

• ‘Unfair’ on those producers who have invested

• … A different approach is needed

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Suggested Approach (1)

• Need to avoid a massive egg shortage in the EU and avoid a significant increase in prices to consumers

• If there are some producers who need additional time to phase-out conventional cages, this should be provided – but, maximum of 1-2 laying flock cycles to encourage early compliance– stocking density in CCs must also be reduced to 750cm² per hen

• During this time there must be an intra-EU trade ban on table eggs (from conventional cages) to prevent those producers who have made the investment from being commercially disadvantaged– In other words, eggs from conventional cages continuing to operate under

this time-limited derogation could only be marketed as table eggs in the member state of production

• A clearly set out plan to convert conventional cages to either enriched cages or non-cage systems must be put in place– Must be approved by the national competent authorities– Strict penalties for non-compliance introduced

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Suggested Approach (2)

• Enforcement …

• To allow enforcement authorities to differentiate between eggs from enriched cages and conventional cages, eggs from an enriched cage would be marked with a No3 from 1st January 2012 and eggs from a conventional cage would be marked with a No4 or other mark. – All egg marking must take place on the production unit

• Control is vital. Need increase in FVO inspection visits in 2012 to check for compliance– If non-compliance noted, immediate action to be taken

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Conclusion

• Doing nothing is no longer an option!

• Council/Parliament/Commission must intervene if all laying hens currently housed in conventional cages in the EU are not converted by 1st January 2012– to ensure that EU consumers can continue to be offered affordable,

high quality, safe, EU produced eggs

• EU standards are now among the highest in the world

• Must maintain EU model of production to avoid egg production being ‘exported’ to non-EU countries (and then import eggs and egg products from non-EU countries)

• Commission has been asked to closely monitor the development of egg production systems in each member state up to 2012– Member states must be required to report hen numbers housed in both

‘enriched cages’ and ‘conventional cages’ separately

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Annex

For background Information

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Annex - EU Egg Industry Background (2009p)

• Egg Production (source: EC)– EU – 27 7.427 million tonnes

• System of Production (source: EUWEP estimate) – Conventional cage 62.5%, Enriched cage 8.5%, Free range 9.2%, Barn

17.1%, Organic 2.7%

• Number of Laying Hens (source: EC)– EU–27 354 million (+ 148m ‘other’ hens)

• Egg consumption (EU-27) (source: EC)– 235 eggs/capita/annum, or 14.68 kg/capita/annum

• Exports – 140,000 tonnes (1.9% of production) (source: EC) • Imports – 40,000 tonnes (0.5% of production) (source: EC)

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More space per hen, higher cost……. (Source: Van Horne, LEI)

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Production cost eggs 2008, EU and non-EU (Eurocent/kg)

1519

10 13 11 11

50

53

37

4038

33

0

10

20

30

40

50

60

70

80

90

100

NL FR US BR ARG IND

euro

cen

t p

er k

g

manure

electricity

general

housing

labour

other

feed

pullet

(Source: Van Horne, LEI)

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EU Import levies on whole egg powder 2008 (Eurocent/kg)

499

341375 353 328

2121

137137

137

21

3

17

137

0

100

200

300

400

500

600

EU ARG USA BR INDIA

cent

per

kg

production cost transport levy on imports

(Source: Van Horne, LEI)

EUWEP

EU Import levies whole egg powder 2012 (Eurocent/kg)

499

341375 353 328

30

--21

137137

137

21

3

2117

137

0

100

200

300

400

500

600

EU ARG USA BR INDIA

cent

per

kg

production cost (excl EU-Directive) cost of EU-Directive transport levy on imports

(Source: Van Horne, LEI)

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EU Enriched Colony

(Source: Big Dutchman)

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Number of EU Laying Hens by System of Production (‘000) (2004 – 2012F)

34.2 m Romanian ‘back-yard’ hens included as FR

Non-compliant hens from 1/1/12

Enriched cage includedfor first time

EUWEPSource: EUWEP / from DG AGRI data

Updated on 28th May 2010