He stressed at the Midwest Poultry Federation Convention last month in St. Paul, Minn., (March 07) that while the market is growing, it's crucial for producers thinking of getting into the specialty business "to know what their costs are."
For example, California organic corn now costs "$7/bu-plus, and we're at a point where we're going to have a problem." Marquardt, whose company produces organic and specialty eggs for nationwide customers, said that organic egg producers "should have feed costs in the contract to protect yourself. Have a contract with flexibility."
Marquardt also said that producers who want their layers to produce eggs high in omega-3 need to be aware that one of the costs of feeding flax is lower production.
Illustrating the move to "locally grown," Marquardt says that one thing he is seeing is that retailers are starting to have different grades for eggs depending on whether the eggs are locally grown, as well as how the birds are raised.
On marketing, Marquardt said that "trade shows are great, and can be very profitable, but it costs about $10,000 to go to a show. Select the one that's right for you."
A lot has changed in the past 10 years, he said. A decade ago, the cage-free equipment shown at the Midwest show would have been nonexistent.
Kevin Elfering, director of dairy and food inspections for the Minnesota Department of Agriculture, said there are several problems associated with labeling. For example, he said that free range is not legally defined, and in fact, free-range birds that are outside could actually have less space than caged birds.
Elfering also said that some companies have been tempted to stretch their labels beyond what's accurate. "We have seen some companies put cage-free labels on eggs (from layers) raised in cages."
On omega-3 and lutein, he cautioned the industry to state the amount for the label to be beneficial, "so many milligrams." Some things Elfering does not like to see on labels: no artificial growth hormones, which eggs and poultry don't have anyway. "No added hormones is deceptive. And natural. What's an unnatural egg? Natural means minimally processed with nothing added. You can't have an unnatural egg if defined by federal law." Elfering advises companies to not embellish, and to substantiate their claims. "If you claim eggs are high in omega-3, have a lab analysis."
Sustainability Versus Organic
Lenny Russo, chef and founder of Heartland Restaurant, St. Paul, Minn., who tries to buy local ingredients as much as possible, said, "we're looking more at sustainability than organic." He noted that it's possible to grow organic food without rotating crops. "That's a big issue for us," he said. Russo added, however, that "quality has to be first or we won't buy it." He also said that he wants farmers to charge him what it takes for them to make a profit. "If the farmer is successful, I'm successful," he said. "I can pass some costs along and eat some as well."
While he said that on most food ingredients, he's looking for consistency on size, flavor, and texture, on eggs he's "willing to give up a little on consistency" for a cage-free product. Since eggs are used as ingredients, their size consistency is not as critical, he says.
Steve Kopperud, senior vice president, Policy Directions, Washington, D.C., said he does not take issue with organic and other specialty producers, but does have problems with producers of those products who imply that their products are better. That plays right into the hands of enemies of the industry, he said, such as the Humane Society of the United States, with a budget of $120 million and "whose goal is to put everyone in this room out of business. There is room for all production practices," he said, but it hurts the entire industry "when we trash each other."