When California voters approved Proposition 2 in 2008, they overwhelmingly agreed that hens deserve the freedom to move around and flap their wings – which they can’t do in conventional battery cages. The requirements of Proposition 2 took effect at the beginning of this year, but as recently as this February, court cases brought against California’s new law were still being reviewed. While these lawsuits have been dismissed, there remains confusion about how much space per bird is enough to meet California’s new requirement.

Significant attention has also been given to the rising cost of eggs, pitting hen welfare against consumer wallets, food businesses, and egg producers. Nine states currently have either passed ballot initiatives or enacted laws that regulate on-farm welfare practices. Research suggests, however, that if asked today, consumers in nearly half of U.S. states would vote to increase welfare for farm animals (Journal of Agricultural and Applied Economics, 46, 1, Feb. 2014).

Illinois, the fourth-largest hog producing state, and Georgia, the largest poultry producing state, are two examples of states that do not currently have farm animal welfare laws in place but where this research suggests that consumers would support increased regulations. Introducing more state laws, however, will continue to create a patchwork of standards that leave producers and food businesses to sort through the details and try to make some sense of whether larger cages or cage-free is the answer. 

The United Egg Producers and the Humane Society of the United States were unsuccessful in convincing Congress to pass federal legislation designed to give hens more space to move. But in the absence of clear federal mandates, consumer purchasing trends emphatically show that cage-free is the way forward. 

Animal welfare and its impact on food buying decisions

In research conducted by ESI Insights for World Animal protection, 67 percent of shoppers already consider animal welfare in their food purchasing, with 43 percent more doing so more today than just five years ago. Millennials factor animal welfare into their buying in even greater numbers. With 83 percent of millennials taking animal welfare into account when buying food, it's clear that public demand for better treatment of farm animals is not just a trend. Businesses looking to prepare for the next generation should read this as a sign of what's to come. 

Food businesses and producers will likely argue that consumers’ beliefs don’t necessarily align with their shopping behaviors -- but that’s also changing. Dollar market shares for selected products with humane labeling rose from 1 to 9 percent by the end of 2013, up from nearly zero in 2009. One major mayonnaise brand that announced a shift to cage-free eggs experienced a 13 percent market share increase and a 46 percent increase in sales following their announcement. Another small study looking at the effects of simplified egg labeling at point-of-purchase showed a 43 percent increase in market share for cage-free eggs, with the lowest-price cage-free brand experiencing a sales increase of 74 percent.

Egg price increase temporary?

The increase in current egg prices caused by California’s changing laws should also be seen as temporary. As more consumers become knowledgeable about the differences between cage-free versus caged egg production, market share will reflect a preference for cage-free. An analysis of scanner data, prior to the Proposition 2 vote in 2008, reveals that cage-free and organic egg sales increased by 180 and 20 percent, respectively, while the sale of less expensive, conventional eggs dropped. This was a result of consumer education leading up to the vote. If only 15 percent more consumers become aware of welfare concerns in egg production, then market shares are predicted to increase by 20.3 percent and profitability per shopper by almost 5 percent. As market share of cage-free eggs continues to rise, improved production efficiencies and economy of scale are sure to reduce the cost.

Consumers want to see hens out of cages, regardless of their size. We recognize that conversions away from battery cages on farms may take ten or more years and significant capital investment. But this also presents an opportunity. Investing in costly refurbishments and new barns with larger cages is not only shortsighted, but is sure to be a short-term solution as well. Investing now in cage-free egg facilities is guaranteed to be a win for consumers, producers, and hens.

 

Editor’s note: World Animal Protection, formerly known as the World Society for the Protection of Animals, is committed to the conversion of egg production to all cage-free. This organization is not against the use of animal meat or products in the human food chain.

The views expressed in the guest commentaries on WATTAgnet.com are those of the authors’ and do not reflect the opinions of the editors at Watt Global Media. Those with differing opinions are encouraged to comment on this site or contact tokeefe@wattnet.net