Future directions in the global egg market came under the spotlight at the recent 70th anniversary celebrations of layer breeder and distributor H&N, held in Bangkok in March.
Potential for greater egg production
With the premise that the reason for producing eggs is to supply food for human consumption, delegates were told that the global population is growing by 1.2 percent per year, meaning that, over the past 12 months, the world’s population has increased by the equivalent of the entire population of Germany, Iran or Turkey.
While the population is growing -- resulting in more mouths to feed -- the growth rate has been stronger in some parts of the world than others, meaning that demand for eggs and trade patterns are shifting, explained Professor Rudolf Preisinger, chief geneticist with H&N.
Dr. Rich Wall, vice president of H&N explained that, last year, the world’s most populous countries were China and India, far outstripping the U.S. in population numbers, which ranks third. However, by 2050, India will hold the top slot as being the most populous country, and Nigeria will have overtaken the U.S.
In 2013, total world egg production, including breeding and hatching eggs for broilers and layers, is estimated to have been 69 million metric tons. Table eggs accounted for 95 percent of production, while there are thought to be an estimated 6.9 billion laying hens in the world.
Asian annual egg production totals 41 million metric tons, and although the region is close to being self-sufficient in eggs, it is not quite there yet. While egg production has been growing across the region, the rate of growth has not been evenly spread.
China is the world’s largest egg producer, and it produces four times the number of eggs produced by the world’s second largest producer, the U.S. China has raised egg output by 2 million metric tons over the past 13 years.
Brown, white egg preference
Consumer preference for eggs is not the same the world over. Ignoring China and Japan, approximately 49 percent of eggs sold are brown, while 49 percent are white. Approximately 2 percent are tinted.
In China, however, tinted eggs comprise 24 percent of total egg production and account for 12 percent of production in Japan.
Egg consumption drivers
Wall outlined the factors that influence the potential for individual markets to consume more eggs. These include:
- per capita income, population growth rate
- Market saturation
- Promotion and marketing
- Production costs and retail prices
- Use of eggs in traditional cooking
- Religious and dietary restrictions
- Cost of competing animal proteins
Per capita egg consumption worldwide stands at 163. If one looks at consumption levels in Mexico, Japan and China, which stand at 347, 329, and 300, respectively, clearly there is significant potential for the global average to rise significantly.
Preference and regulatory changes ahead
The global egg industry is not only responding to rising demand, it also has to adapt to changing pressures.
Looking at Europe, Preisinger told delegates how animal rights is increasing in importance and how this trend can be expected to grow worldwide.
The example was given of how Germany banned conventional cages six years ago, and how this was followed by the European Union in 2012. Also in Germany, two states have banned the destruction of day-old male layer chicks. This could be adopted nationwide one day and, should this happen, Switzerland, Austria and the Netherlands are likely to follow suit, perhaps then followed by an EU-wide ban.
Looking at the U.K., there is now serious discussion of beak treatment.
Pressure is coming from retailers and fast food restaurants to raise the role of animal welfare in today’s livestock production across species, and egg farmers will not escape this pressure.
In the case of beak treatment, should there be a ban, there will be more cannibalism. Generally, a ban on beak treatment would result in a doubling of mortality in closed houses, and in some cases this would be much higher. Producers will lose and retailers will win, with the latter blaming geneticists for not having bred a more docile bird that never pecks.
This is not simply a European issue. Preisinger recounted that, five years ago, he had been talking to producers about cage-free production in the U.S. and that their response was, “you’re dreaming.” But now, he continued, one only has to look to California to see cage-free egg production in the U.S.
Where the culling of male chicks is concerned, it should be possible within 5-10 years to sex determine the embryo at under 10 days of development.
One of the areas in which H&N is working is in the development of a layer with a more uniform beak. While pecking cannot be stopped, you can at least reduce the damage that it inflicts, and this is important in light of possible moves against beak trimming, Preisinger said. And just as the U.S. is beginning to move against cages, within 10 years, North American retailers could well be promoting eggs from non-beak trimmed birds. These and other factors all influence the direction in which H&N is developing its birds.
“Think about the current EU legislation of keeping hens in enriched cages, free range, the ban on beak treatment and culling day-old male chicks. Even regional differences and habits, market saturation in some countries and considerable growth in other regions, all play a major role in breeding strategies,” said Preisinger.
Javier Ramirez, H&N managing director, said at closing that that it was increasingly important to be close to parent stock customers, and that the company would make further investments to increase GP sourcing from Europe, North America and Asia.
