United Egg Producers president explains welfare agreement

The United Egg Producers have set a target of getting the egg products inspection act changed by Congress by June 30, 2012, to include the key points of UEP’s agreement with the Humane Society of the United States. The next 12 to 18 months could determine the type of housing systems used in the U.S. for layers for the next several decades.

Gene Gregory, president and CEO, UEP, answered Egg Industry’s questions about how UEP will face what could be the most interesting and challenging period the U.S. layer industry has experienced.

Egg Industry:  Why not a voluntary agreement setting a new housing standard for layers instead of seeking federal legislation?

Gene Gregory:  The real reason is that UEP and some egg producers have a major antitrust lawsuit filed against us where the primary complaint is that the UEP Certified animal welfare program was put in place only to restrict the supply of eggs and fix the price of eggs. That is foolish, since our guidelines came from an independent scientific committee and were endorsed by the Food Marketing Institute and the National Council of Chain Restaurants, and our farms are audited by the USDA. The complaint is bogus, but a big-time plaintiff law firm has brought this case. We are spending millions of dollars to try and defend ourselves. Because of this, our attorneys will not let us enter into any agreements setting industry standards on our own in a voluntary way until this litigation is settled. We had talked about adding enriched colony housing as a third option for producers that wanted that, but our attorneys wouldn’t allow us to do this.

EI:  Isn’t the Humane Society of the United States providing the money behind the lawsuit?

GG:  I can’t acknowledge who we think is involved in any public way.

EI:  Washington, D.C., lobbyists who work on animal agriculture issues have suggested that it will be a tough uphill struggle to try and get legislation passed which sets federal standards for housing laying hens. Can this legislation get through Congress?

GG:  We were not so naïve to think that this would be easy. We don’t know if it is possible to do this, but we have to explore this.

EI:  What would you say to other animal agriculture groups who have expressed reservations regarding UEP and HSUS asking for federal legislation addressing layer housing?

GG:  My only regret is, we wish that you had waited until you knew more about the details, wished you had waited until you heard our story, wished you had waited until at least a bill was written; then you could lobby against it at that time if you wanted to. But instead, they immediately came out in opposition to this without even knowing the details or reasons of why we need to do this. That is my regret; UEP would never do that against some other animal agriculture association or industry. Each of us has to so some things to protect our own industries. We have taken great care to make sure that there are no other animals added to the legislation that we would like to pass. I think that even if you talk to HSUS they would acknowledge that they can’t pass any federal legislation for any farm animals unless they have the support and endorsement from those animal species organizations as well. When the other animal agriculture groups express their fear about this I think it is unfounded.

EI:  If the legislation passes, what is to keep HSUS from coming back for another bite of the apple five years down the road?

GG:  We are proposing this legislation as a change in the egg products inspection act. We don’t think that they can get that legislation changed or get new legislation without our help. With state legislation and federal legislation we have fought them several times and won every time. It is only when we have had the voter referendums or ballot initiatives when we have lost.

EI:  Has UEP looked at what will happen next if the legislation doesn’t pass?

GG:  We have not, and the reason we have not is the litigation. If the legislation doesn’t work, and if the litigation wasn’t an issue, UEP would probably add enriched colony housing as a third option in the UEP Certified program. I worry that if the legislation doesn’t pass, welfare organizations may get even more aggressive against the industry than they have been in the past. There are 24 states with the ballot initiative option. There are lots of states that could have ballot initiatives pass and each have their own standard for housing hens. This can lead to a big market disruption.

EI:  Why 124 square inches for white layers instead of 116 square inches like they are using in the EU?

GG:  This is one of my disappointments. I have always said UEP would not make any changes unless justified by science and recommended by our scientific advisory committee. The new standard of 124 square inches for white layers and 144 square inches for brown layers at this time has no justifiable science to warrant this, but like in any negotiation there is sometimes a middle point that you have to reach. HSUS wanted 144 square inches for white layers like the standard for cage-free, we wanted 92 square inches. Then they wanted to be able to say they doubled the space to 134 square inches (from the current UEP Certified standard of 67 square inches). UEP wanted 116 square inches like the EU. Eventually, the parties agreed to 124 square inches after a long negotiation. This agreement provides a pathway to the future where we know what kind of houses to build. This agreement gets rid of ballot initiatives, gets rid of lawsuits and does a lot of other things. We had to go to 124 inches per bird to get it.

EI:  In order to get legislation passed, it would be best if the egg industry presented a united front, but there is a potential for this housing agreement to cause some UEP members to leave the group. What is next?

GG:  We are concerned about that. UEP has a history of not being vanilla; we are always out front and doing things. We were the first animal agriculture group to develop science-based animal welfare guidelines back in 2002 and have third-party auditing and certification. Years ago, when we first started working on this, we had people in the industry who were opposed to this who said that this would divide the industry and destroy UEP. But our board felt strongly that this was something that we needed to do; well, instead of dividing the industry, it actually increased our membership. We wound up with 80% of eggs in this country being produced under these guidelines. Now we enter into an even more controversial area, because in this case we are talking about major capital investments; we are talking about government telling you how you are going to operate your business. Those are things that producers have deep concerns about. We worry that we will have some members that are so adamantly against this that they may drop their UEP membership, but UEP is about a whole lot more than just animal welfare and this. We do all kinds of things for them in other areas. We undertook this knowing that it was going to be quite controversial, but we knew that we had a conflict here that we had to try and resolve. That is why we are exploring this option. When you see your members in states like California, Oregon, Washington, Michigan and Ohio being affected like this and you sit by and don’t do anything to try and resolve this, are you being the kind of association you should be?

EI:  Whether or not the housing legislation passes, the industry will have to sell consumers on the benefits of enriched colony housing because as far as the welfare groups are concerned, it still isn’t cage free.

GG:  That is the market place; we will produce whatever the consumer wants. If they want organic, or if they want cage-free, we will produce it. If consumers want cage-free, the industry will produce it, but enriched colony production will replace production from traditional cages. We think the enriched colony housing will be affordable and will not price consumers out of the market; it will be considerably less costly than cage-free eggs. We know that cage-free production is not economically sustainable (for the industry as a whole), and we know that it doesn’t improve the welfare of the animals.