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Davis, California

Saturday, June 22, 2024

Study considers economic impacts of Prop 2 on egg industry

The debate surrounding Proposition 2 prompted a group of UC Davis experts to release a study that delves into the economic implications of the ballot measure.

The initiative would require housing for egg-laying chickens to allow them to lie down, stand up and turn around freely.

The report claims that the new housing system will raise production costs to be 20 percent higher compared to other states, due to higher feed costs, hen mortality, labor costs and direct housing costs.

California is competitive in the national egg industry and produces approximately 6 percent of the national total of table eggs while consuming about 12 percent. Current non-cage production of eggs in California is about 5 percent of the state’s total production, according to the report, released in July.

“Since about half of consumption is already shipped into California, when the costs of eggs produced here goes up it gives eggs from out of state a major advantage,said Daniel Sumner, the study’s lead author and director of the Agricultural Issues Center.

One-third of shell eggs consumed in California come from other states. The report concludes that any rule raising the cost of egg production in California over that of other states will cause out-of-state egg shipments to increase.

“In this case with costs for the same product going up by 20 or 30 percent, the egg producers in California would simply be unable to compete,Sumner said.The case of egg farms is even worse, because the initiative would require new cage free housing and it simply makes no economic sense to make a big investment to stay in a business in which they would lose money.

The report predicts that within the six-year adjustment period included in the initiative, the egg industry in California would be almost completely eliminated due to the increased costs of non-cage egg production and competition with other statesconventional egg markets.

“It’s not as simple as just changing things over,said Nancy Reimers, DVM and member of the American College of Poultry Veterinarians.

Farmers might need to buy more land and replace equipment to comply with the measure if passed and would be given six years to make the transition. While this may sound like enough time, for many farmers it might not be, Reimers said.

The study points out that the majority of eggs consumed in California would still be produced in cage housing systems, since egg producers in other states still use cage systems.

“The eggs would no longer be produced in Merced or Sonoma or anywhere in California,Sumner said.Instead eggs would be produced using the same cage systems as used now, but in Iowa or Utah or some other state.

Sumner believes the initiative would have no impact on how eggs are produced, only where they are produced.

“If passed, this initiative would have no impact on animal welfare or food safety or any of those issues, because it would not change the way eggs are produced,he said.

The authors of the study expectlittle, if any, cost increase and no substantial impact on prices to California consumers.

Jennifer Fearing, Campaign Manager for YES! on Prop 2 and chief economist for The Humane Society of the United States said the conversion will cost consumers less than one penny per egg.

“We are talking about it costing less than one penny per egg to produce cage-free eggs. It’s an incredibly modest amount of money,Fearing said.The truth is that [caged egg producers] are more interested in making a profit than taking care of their animals and producing food that is healthy.

“We will see more competition in a cage-free market so prices will come down,she said.Most importantly, we will have set a standard in California that we do not believe in saving a penny for an egg if it means treating animals cruelly and inhumanely.

Director of Animal Shelter Medicine Program and UC Davis School of Veterinary Medicine professor Kate Hurley believes there is a problem with how animals are currently housed.

“The animal health problem that prevented animals from standing up or extending their limbs, we consider that a serious health issue,she said.We know across specieshuman, dogs, chickens when you have animals very densely [contained], consistently studies show that the risk of disease of infection can spread [and] is increased.

Chickens are currently housed in cages that greatly restrict their movement, Hurley said.

“Chickens are on a wire surface, an unnatural surface for a chicken [that] prevents them from scratchingvery little space to live out entire life,Hurley said.[They are] prevented from doing any normal behaviors; they cant even walk a few steps forward.

Proponents of Prop 2 say the added space would decrease the risk of disease among the birds.

But feed, light, air, water, space and sanitation are the main guidelines that keep hens healthy, not just space, Reimers said.

“I really feel like it’s a well intentioned proposition but it fails to take into account several detrimental consequences of animals and humans,Reimers said.When you look at housing systems, that were developed in 1920s and 1930s, we found that when we moved chickens indoors we were able to keep them from getting many diseases they would get from the soil, and protect the from predators.


POOJA KUMAR can be reached at campus@californiaaggie.com


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