I think the announcement made last week by Mexico’s Grupo Bimbo, the largest bakery company in the world, was surprising. Starting in 2016, the company will implement a program to work with its suppliers to supply liquid and shell eggs from cage-free hens. I say it was surprising, because in Latin America we believe that such things only happen in the developed world. Well, not anymore.
It is also interesting to note that this new provision comes from a global company that is not Walmart, Nestlé, Unilever, Starbucks or McDonald's, but Grupo Bimbo, a Latin American company.
Grupo Bimbo, besides being the master of bread in Mexico, also has operations in the United States, Canada, several countries in Latin America, China, U.K. and Spain. So, with this global presence, what will be the impact on the poultry industry?
At least in Mexico, there are no cage-free commercial egg production operations of importance. Bachoco has a brand of eggs of this type, which as far as I understand, has had no impact, but with it, the company has already set a foot in this market. Is it that the Mexican public, and by extension the Latin American public, is insensitive or ignorant of animal welfare? Or is it that the concern is only eating, from whatever source?
Mexico has a high egg consumption rate. An outbreak of avian influenza in Mexico affected to such an extent the product price that there were jokes and memes that made mockery of the eggs being sold in monthly payments in department stores. Now it could face a further price increase, because it is undisputed that the cost of production will increase and thus the retail price will also increase. Just ask the Spanish producers.
The animal rights groups are delighted. And it's no wonder. They scored a big goal. And Bimbo scored a marketing strategy. But in a market economy, the market itself is the boss. We'll see what happens.