April 1st will not be a day of amusement for egg producers. It is the day in which energy prices are set to rise by 54% average. This will be on top of the estimated 40% increase already imposed over the last year.
This was only one of a number of cost increases loaded on producers.
Feed costs have also gone up from about £270 a tonne to over £320/tonne average, an increase of £50 or over 18%. This alone makes a cost increase of 10p/dozen for the eggs produced essential.
With all the other increases, there is an overall penalty of something like 20%+ to produce a dozen eggs, for which, no extra income is being received.
For those marketing through packers to supermarkets, it must be galling to see egg prices in the stores increase by more than 12% on average in the last year, none of which trickled down to the producer.
As a result of losing money on every egg produced, is it any wonder that an increasing number of producers are cutting back on the number of birds being replaced at Point of Lay, depopulating flocks early, cancelling orders for pullets, or even giving up production entirely!
Every day I am receiving more and more reports of all these scenarios. I would estimate we may have lost several million layers already.
If this continues, then prices will go up, because of scarcity. Not a great way to achieve better prices.
Obviously, this would make my remarks in the last item, of eggs being of extreme value as a food commodity, for those in poverty, difficult to maintain.
Unfortunately, the outlook is one of the bleakest I have known in many years in the industry, but it is a resilient industry, and will surely ride the storm.
Laid in Britain producers, being their own marketeers not involving a middle-man, or finance contract to a feed company, with the added expense of this, are in a somewhat better position for the price they receive for their eggs, and maybe even a tighter control over costs.
Certainly they can emphasise both the freshness and the saving in food miles, attached to their produce.
Though it will make life even harder for those in the poverty sector, so be it.
The whole future of the UK egg industry desperately needs a price rise to overcome continuing rising costs.
