Scottish Egg Producer Retailers Association. MARKET REPORT

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1 Scottish Egg Producer Retailers Association Date: 28th June 2013 MARKET REPORT Size V. Large Large Medium Small Farm to Shop Prices p Scottish Wholesaler Prices p 70p English Wholesaler 1 Colony p 54p p F/R 2 Colony p 55p F/R p Packer / Producer Contracted average Price Organic FreeRange Barn Colony 1.30/ p/ p/ p/ 1.00 Producer / Consumer V. Large Large Medium Small - Colony Prices p - Free Range Prices Free-Range to Farm Shop Prices 1.75/ / / p 46p 60p 48p Central Egg Agency Colony p F/R Imported Continental Prices in Bulk Dutch Eggs Barn 95p 66p 59p 60p p 75p Prices are a no change situation, but there are signs of recovery, the heavy discounting on published prices has almost stopped, with reports of free range supplies being tighter and even the major players saying that the market is coming back into balance, but as next week brings us into July it should be. In Scotland demand appears to be picking up, as we are getting a steady increase in tourists with hotels, guest houses and B & B s getting increases in numbers and business, but one curious statistic came to light this week, that restaurants were now finding they were busier through the week than at weekends. We are including this week two pieces about our cousins in the USA, the first piece is from our friend Phillip Clarke of Poultry World, who as usual sums up the American situation well, they are the exact reverse of our situation in the EU, we have had vast amounts of legislation thrust upon us by our own governments over the years usually coming from Eurocrats sitting in an office in Brussels who regularly don t understand the problems in industry, but make their decisions on who lobbies them the most and makes the most noise, while we in the industry are too busy just trying to make a living.

2 While in the USA their poultry industry is desperately trying to bring standards of welfare and product up to our EU levels to improve their worldwide market ability, but it is other sections of agriculture that is blocking the legislation that would give standardisation of egg production throughout the USA. This would mean that only the states that are proposing to bring in the higher welfare standards, would technically be able to export to the EU, with California which is the furthest away the only one at present. US Farm Bill rejection scuppers hen welfare plan Legislators have all but killed off the US egg sector's plans to raise welfare standards, with barren cages now set to remain the norm in the vast majority of states. The plan was to include the draft legislation within the Farm Bill as it progressed through both the Senate and the House of Representatives in Washington, writes Philip Clarke for Poultry World. The farm bill has since been rejected. If agreed, this would have paved the way for the introduction of enriched colony systems and increased space allowances, along the lines agreed by United Egg Producers (representing over 90% of US egg output), and the Humane Society of the United States. An amendment to the Farm Bill was laid in April, but senators rejected it in May, having been subject to intense lobbying by other livestock groups who feared it would set a precedent for government interference in farm methods. At the time, UEP president Chad Gregory said he was still optimistic that the so-called Egg Bill would win support in the House of Representatives, which debated the Farm Bill this week. The House was believed to include many more representatives with consumer rather than farmer interests at heart. But the House has not only rejected the amendment, but failed to pass the Farm Bill at all, leaving support for US agriculture in a state of limbo. Gregory expressed his great disappointment. "We knew that legislating a national standard for egg production wasn't popular with some other farm groups, and even a few egg farmers, and we tried to address their concerns as best as we could," he said. "But the vast majority of our board of directors supported it as the best alternative to a patchwork of conflicting state laws. I believe history will show that what we have stood for is the way of the future. The UEP leadership will be evaluating the best path forward in the coming months." California has already passed legislation improving hen welfare, as have Michigan, Washington and Oregon. Ohio is set to follow suit by Philip Clarke.

3 US launches agreement to further shell egg safety The Food and Drug Administration (FDA) in the US has announced its intent to establish a Cooperative Agreement with the North Carolina State University, Prestige Department of Poultry Science and the Piedmont Research Station Poultry Unit to conduct studies to further progress on the safety of shell eggs in the US market. In 2009, FDA issued the Egg Safety Rule, which was designed to prevent foodborne illnesses and deaths caused by consumption of eggs contaminated with Salmonella Enteritidis (SE). This regulation requires industry to implement measures to prevent eggs from becoming contaminated with SE during their production in poultry houses and requires subsequent refrigeration of the eggs during storage and transportation. The goal of the cooperative agreement is to research routes of transmission for Salmonella species, including but not limited to SE, found within the egg production industry and to investigate how alterations in physical feed characteristics and housing may influence the transmission of Salmonella. Of particular interest is determining whether other Salmonella serotypes, such as Salmonella Heidelberg (SH), behave similarly to SE, since outbreaks have been caused from consumption of eggs contaminated by SH. Findings from the studies will help FDA and members of the egg industry better understand routes of Salmonella transmission and the food safety controls necessary to prevent illnesses from consumption of shell eggs. FDA pursued collaboration with the North Carolina State University, Prestage Department of Poultry Science and the Piedmont Research Station Poultry Unit because their research facility mimics the size and scale of commercial poultry operations. The actual cooperative agreement will issue and go into effect in September World Poultry. US poultry groups urge Congress to repeal RFS Following the introduction of the bipartisan Renewable Fuels Standard Repeal Act, the National Cattlemen s Beef Association (NCBA), National Chicken Council (NCC) and the National Turkey Federation (NTF) are urging Congress to repeal the Renewable Fuels Standard (RFS). Chicken producers are already competing with the weather, said NCC President Mike Brown. Why must we also compete with an inflexible federal mandate that voluntarily places another strain on our limited resources? I commend Sens. Barrasso, Pryor and Toomey for taking an approach that would let the

4 free market decide whether corn should go to food or to fuel. The RFS last year required 13.2 billion gallons of corn-based ethanol to be blended into gasoline; it mandates that 13.9 billion gallons be blended in 2013, an amount that will use about 4.9 billion bushels of corn, or about 40% of the nation s crop. RFS has been such a poorly managed mess, it s time to drain the swamp, said NTF President Joel Brandenberger. The RFS needs a fresh start in order to put in place a smarter policy on the mix of fuel and feed. Animal agriculture has long been suffering at the hand of this broken policy, especially feed costs in the turkey business. The RFS has caused an increase of $1.9 billion in feed cost alone for turkey farmers, as corn continues to be syphoned off to ethanol. Livestock and poultry groups called on the administration last fall to waive the RFS, for the second time since And for the second time, in spite of the widespread drought and lowered harvest, the US Environmental Protection Agency (EPA) refused to use the safety valve built into the biofuels mandate. NCBA, NCC and NTF call on Congress to repeal the RFS to ensure market stability certainty for rural American economies. World Poultry. We are including the graphs on grain prices which are compliments of BOCM Pauls, the first one shows wheat prices in the last year and shows the steady drop in price with the improved quantity available and reports of greatly improved harvests throughout the world with the exception of the UK, but it s a world market which dictates price WHEAT PRICES DD Selby /tonne Jul Jun 05-Jul 02-Aug 30-Aug 27-Sep 25-Oct 22-Nov 20-Dec 17-Jan 14-Feb 14-Mar 11-Apr 09-May 06-Jun

5 The second graph on soya is of particular interest as you will note that the price for non GM soya, (in pink) stops at the end of April as there was none available, which explains why several supermarkets dropped their demand to have no GM grain included in poultry feed, but the lack of non GM grain is still giving increasing problems to our Organic producers /tonne SOYABEANMEAL PRICES June 13 April June Jun 28-Jun 19-Jul 09-Aug 30-Aug 20-Sep 11-Oct 01-Nov 22-Nov 13-Dec 03-Jan 24-Jan 14-Feb 07-Mar 28-Mar 18-Apr 09-May 30-May 20-Jun (Can we believe this, or take it with a pinch of salt. Editor) EU: Modernising legislation for food, feed The European Commission is modernising legislation around food, feed, live animals, and plants. The European Commission has published a package of proposals to revise the current legislation governing health controls in the food and agriculture industries. The proposed plans will potentially affect all those involved in the production, manufacture, supply and regulation of food, feed, live animals, plants and plant reproductive material such as seeds. The Commission s aim is to develop a modernised legal framework for a more competitive EU. The proposals should simplify the existing regime by consolidating approximately 70 current pieces of EU legislation. It will aim to create a more consistent approach to official controls, such as inspection and approvals, throughout the food and agriculture sectors. The changes are also intended to support more sustainable and effective control systems across European Union (EU) Member States. The five elements of the package 1. The animal health regulation, which aims to protect and raise the health status and condition of animals

6 in the EU, in particular food-producing animals, whilst ensuring intra-eu trade and imports & exports of animals and animal products in accordance with the appropriate health standards and international obligations. 2. The plant health regime, whose objective is to protect EU agriculture and forestry by preventing the entry and spread of foreign plant pests. 3. The marketing of planting material such as seeds of agricultural, vegetable, forest, fruit and ornamental species and vines, which ensures the quality and productivity of this material given that it is the first link in the food chain and in forestry. 4. A legislative framework for the organisation of official controls concerning food and feed safety, animal health and welfare, plant health and plant reproductive material, established to ensure that the sector specific rules are enforced by the Member States across the EU in a harmonised manner. 5. The fifth proposal - modernising the financial framework for the 4 preceding policy areas in order to support their goals is expected to be published by the Commission on 6th June. This proposal is linked to the multi-annual financial framework and proposes replacing the current multiple legal bases for cofinancing with a simple, clear and modern legal framework which optimises the implementation and the financial management of EU funding in this field. Full details of the Commission s proposals can be found on the Commission s website. The Food Standards Agency is leading on the official control proposal, with Defra leading on the rest. Source: gov.uk How many eggs does it take to screw in a light bulb? None, Eggs don t have any hands.