California’s Proposition 2 and the Rise of the Cage-Free Egg

eggs-685x1024As with pork, beef and lamb, our eggs are laid by hens raised with all vegetarian feed, in housing approved by the Humane Farm Animal Care and American Humane Certified programs (cage-free) and are never-ever given antibiotics. This means they’re humanely raised, cage-free eggs that don’t contain the chemicals and medicines you find in most store-bought eggs.

Now, all egg producers selling in California have less than four months to establish similar, more humane standards for laying hens because of Proposition 2, also known as the California Standards for Confining Farm Animals Act. This new law will go into effect on January 1, 2015, so we’d like to share some information on what makes this proposition worth talking about.

What is Proposition 2 or the “California Standards for Confining Farm Animals Act”?

Proposition 2 was a ballot initiative passed by the voters of California in November of 2008 by 63% majority.  It required that egg-laying hens and veal calves raised in California be confined only in a way that allows the animals to lie down, stand up, fully extend their limbs and turn around freely.  Proposition 2 does not define exactly what the space and housing specifications would be to meet these requirements, but it is generally believed that twice the space as birds raised in cage-free environments is required – roughly a minimum of 1.5 square feet in floor space per hen.

How will it impact California egg sales?

Opinions vary greatly as to what the impact will be. When the law was passed by voters back in 2008, an estimated 43% of the eggs consumed in California were imported. It is believed that before Prop 2 requirements go into effect January 1st, this number will have risen to 60%.  This could lead to a 20 million egg-laying hen shortage in California.

Modifying caged systems also requires investment, which will likely increase the price of eggs.  Cage-free egg systems are more expensive due to feed, labor and yield losses.  Shipping eggs into California from outside states is also more expensive.  Given the lack of supply of cage free eggs across the country, adding this additional demand into the mix will result in higher prices as well.  How much higher? Will it be that way going forward or will it come back down?  We’ll see.

How will it impact the rest of us?

California consumers are forecasted to buy some 800 million dozen eggs next year.  Despite the majority vote, 95% of eggs sold to consumers in California during 2014 still came from caged hens.  This means that on January 1st, there will be a need for more than 750 million dozen eggs from either cage-free or bigger “enrichable” or “enriched” cages that previously were coming from industrial caged birds.  There is simply not enough cage-free egg supply across the entire country to keep up with this increased demand, so it is expected that the price of all cage-free eggs, in all states, will see a significant increase.

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