Because consumer demand for more expensive cage-free eggs remains low and a glut of cage-free eggs exists, Rose Acre Farms is at least temporarily discontinuing the addition of cage-free laying systems, or as CEO Marcus Rust put it, the company is “shutting [its] construction program down.”
With all major grocery chains and a large percentage of restaurant and foodservice companies committing to only purchase cage-free eggs by a certain date, many U.S. egg producers, including Rose Acre Farms, started transitioning their farms to using cage-free laying systems.
Rose Acre Farms, the second largest egg company in the United States, over the past four years spent about $250 million on cage-free operations and now has about 20 percent of its hens in cage-free housing, Bloomberg reported.
But with consumers still preferring to pay the lower price for cage-produced eggs, it has put egg producers in a position to make decisions regarding whether to continue to add cage-free laying systems, or to put those plans on hold and see how companies follow through with their pledges to source only cage-free eggs.
Cal-Maine Foods made similar decision
Rose Acre Farms is not the only major egg producer to pull back from expanded cage-free egg production.
During its earnings report for the first quarter of fiscal year 2018, which was released on October 2, Cal-Maine Foods CEO Dolph Baker said that because the supply of cage-free eggs is not consistent with the demand, the company has adjusted its cage-free egg production levels in line with the current customer demand.
Baker added that Cal-Maine Foods was well-positioned to increase its cage-free egg production capacity as demand trends change.
Cal-Maine Foods is the largest egg producer in the United States and in the world.
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