Supermarket price war a threat to free range egg production

Another price war between the big supermarkets is once again putting farmer’s livelihoods at risk, and the irony of it is that they are forcing production away from free range and back towards caged egg production according to the Egg Farmers Australia Chief, John Dunn.

Recently the “big three”, Coles, Woolworths and Aldi slashed the price of their home brand free range eggs by 40 cents a dozen to an average price point of $3.80.

“We recognise that the supermarkets are absorbing the initial price cut, but we all know where price wars end – with farmers footing the bill,” Mr Dunn said.

Every day Australians consume 13 million eggs, with an extra 400,000 laying hens needed every year to keep up with population growth, although that growth and production could now be under threat.

“A 40 cent cut will take millions and millions out of the supply chain – it will give limited ability to build new farms, especially with free range capabilities, because they cost more,” Mr Dunn said.

“The elephant in the room is that Woolworths and Aldi have pledged to phase caged eggs out by 2025. The outcome of this move will be less available money for investment in free range facilities.

“The industry prides itself on responding to the market, we responded to the free range market because we get a premium at the checkout, but this has taken that premium away, and now farmers are wedged.” 

“Consumers pay more for free range because they expect more – we are concerned about the effect this will have, and are monitoring it closely.

Local egg producer and chair of NSW Egg Farmers Bede Burke has predicted that the move could have “a devastating effect on the industry”, especially when coupled with a recent spike in grain prices, as well as soaring power costs.

“Feed is 40-50 per cent of production – an increase in feed and a cut in price is an absolute threat to the industry. It’s another chapter in a contrived attack on farmers and their ability to make a reasonable living,” he said.

Mr Dunn said that while he would never ask consumers to vote with their dollar, he urged them to engage with the issue.

“Every carton of eggs has an invested farmer behind it that is committed to producing the eggs you want with a production system that meets your expectations.”