Top egg companies gain market share through consolidation

During the past two decades, the largest producers in the egg industry steadily gained a larger slice of the pie.

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During the past two decades, the largest producers in the egg industry steadily gained a larger slice of the pie.

Egg Industry examined WATT Global Media data on the key companies in the sector stretching from the most recent survey, published in February 2017, to 1993. The results of the research showed how two companies: Cal-Maine Foods Inc. and Rose Acre Farms lead the industry. In all but one year, 1998 when Michael Foods lead the pack, Cal-Maine was the top ranking company in terms of millions of hens in its flock.

Steady at the top

In the 24 year period, with one exception, Cal-Maine and Rose Acre remained locked into the top two positions. In 1993, the US Department of Agriculture’s Chickens and Eggs Report estimated the nation’s layer flock included 239 million hens. The two company’s flocks – of 16.1 million and 11.5 million, respectively – represented 11.5 percent of the national flock. In 2017, when the USDA reported the flock size increased to 314 million hens, the company’s flocks – of 37.94 million and 25 million, respectively – represented 20 percent of the national flock.

For Cal-Maine, which added 21.8 million hens during the period, acquisitions played a major role in the expansion. According to WATT data, the company’s acquisitions included: Southern Empire Egg Farms Inc., J &S Farms Inc. and Savannah Valley Egg Co., all in 1997; Hudson Brothers and Smith Farms in 1999; the shell egg division of George’s, Inc. in 2007; Zephyr Egg in 2008; Pilgrim’s egg operations in Texas and Maxim Production Co., in 2012; Dixie Egg Farm in 2016 and the Happy Egg Co. in 2017.

Rose Acre, which added 11.5 million hens during the period, also made acquisitions, although not as many as Cal-Maine. The company acquired: National Egg Products in 1998 the shell egg business of Crystal Farms in 2009.

Two giants dissolve

A pair of major players in the industry, DeCoster Egg Farms and Moark LLC, were dissolved and contributed to the rise of other companies.

DeCoster, and its affiliated companies in Iowa, Maine and Ohio, were dissolved in 2011 when Austin “Jack” DeCoster and his son, Peter DeCoster, left the egg business. In 2010, the DeCoster companies formed the third largest egg producer in the country. DeCoster’s Iowa operations were snared in a massive, Salmonella-related egg recall in 2010 and its Maine farms were targeted as part of an undercover animal activist video exposé. In 2014, the father and son pair plead guilty to selling contaminated eggs from their Iowa operations.

In 2011 were divided up among Moark LLC, which overtook operations in Maine; Centrum Valley Farms, which overtook operations in Iowa; and the Ohio operations went to a group of Iowa egg farmers lead by JT Dean.

Moark, sold by its owner Land O’Lakes Inc. after years of operating losses, was split between Opal Foods, a newly created company; the Southern California Egg Cooperative and Hillandale Farms in 2014 and 2015.

Key consolidation elsewhere in the industry

More recently, two other new companies were formed through the consolidation of existing egg operations: Versova Holdings LLC and Prairie Star Farms.

Versova was formed in 2016 to manage the combined day-to-day operations of egg producers Centrum Valley Farms LLP, Trillium Farm Holdings LLC and Iowa Cage-free LLP. Centrum Valley, Trillium and Iowa Cage-free will continue to exist independently. As of Dec. 31, 2016, the company’s layer flock included 17.1 million layer hens.

Prairie Star Farms, founded in 2011, markets the combined egg production of Rindler Poultry, Ross-Medford Farms, Hoosier Pride and J Star Farms. As of Dec. 31, 2016, the company’s layer flock included 9.4 million hens.

 

Comparing 1993 with 2017

In the 24 year period examined by Egg Industry, half of the 10 largest egg consumers have retained their spot at the front of the market. In 2017, the top 10 companies accounted for more than half of the market (53.2 percent of US layer hens). They controlled about a third of the market (32.8 percent) in 1993.

1993's Top 10 egg producers, ranked by millions of layer hens:

1. Cal-Maine Foods: 16.1 million

2. Michael Foods: 13.5 million

3. Rose Acre Farms: 11.5 million

4. Buckeye Egg Farm 9.3 million

5. DeCoster Egg Farms: 6.7 million

6. ISE America: 5.9 million

7. Fort Recovery Equity 4.6 million

8. Midwest Poultry Services: 4.5 million

9. Mahard Egg Farms: 4.0 million

10. Hillandale Farms: 2.5 million

The top 10 collectively accounted for 78.6 million hens, or 32.8 percent of the 239 million bird layer flock, as reported by the US Department of Agriculture’s Chickens and Eggs Report.

2017's Top 10 egg producers, ranked by millions of layer hens:

1. Cal-Maine Foods: 37.94 million

2. Rose Acre Farms: 25 million

3. Hillandale Farms: 18 million

4. Versova Holdings: 17.1 million

5. Rembrandt Enterprises 14.7 million

6. Daybreak Foods: 13 million

7. Michael Foods: 12.96 million

8. Center Fresh Group: 9.7 million

9. Midwest Poultry Services: 9.5 million

10. Prairie Star Farms: 9.4 million

The 10 collectively accounted for 53.2 percent of the 314 million bird layer flock, as reported by the US Department of Agriculture’s Chickens and Eggs Report.

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