1814 views
The market, although a lot of prices are down consensus of opinion is that is it, there should be no further reductions and the market is quiet but reasonably balanced, there is a lot of extra Free Range production but it seems to be finding a home with all the extra special offers in the big supermarkets.
This generated a surplus of Colony which has brought down prices also there has been some cheap German eggs about which has exasperated the problem, but now we are hearing of some very big Colony units being depleted which will bring things back into balance and speaking to our Continental contacts they are now saying that prices will firm up.
As we are now half way through May which is traditionally the worst month for demand and usually has a lot of new production particularly Free Range coming in prices might well steady with a hint of increase.
Where are things going, Free Range production is increasing along with demand, Colony is struggling a bit, because of all the special offers in the big supermarkets, with the reduction in prices with the so called supermarket wars, shoppers are buying more Free Range eggs, Organic sales have also increased, but Organic production is now under pressure with the increase in price of non-GM grain which will definitely increase the cost of production, whether that can be passed on or not will effect demand and production as Organic is the highest cost production system and is close to the red figures already.
What now with the big supermarkets, they have reduced prices of eggs to try and stay competitive with the so called discounters and to try and retain their so called market share which they have already acquired from the smaller shops, but they in the process have become so large their administrations and cost of distribution have spiralled out of control and have wrongly accused their suppliers of over pricing.
As the price wars are thought to have slowed down the swing to the discounters, what next?
We have been looking at Germany which is home base for Aldi and Lidl which is showing us a hint of where they might go next, in Germany they have gone completely Barn /Free Range there is a probability they will do the same here, thumb their nose at the big supermarkets by saying you have tried to match prices with us we will sell only alternative production locally sourced with local image and much cheaper, as a first sign Aldi are now selling Organic eggs, with there now being supplies of Free Range available, the question is when?
Avian Influenza, with there now being confirmed cases in most developed countries in the world, with the exception of Africa which has a different migratory bird pattern, everyone still has to be particularly careful and to maintain the high levels of Bio-Security.
Some idea of the problems linked to a confirmed case are shown in the latest outbreak in Iowa USA where production complexes are much bigger and must be a logistic nightmare for authorities just think of the nightmare of having to cull and dispose of 3.8 million laying hens with a total of 5.3 million on site plus other complexes directly linked, this must be regarded as a major problem for them.
