07-08-2014 10:27 AM | News, Poultry

Unmasking the packer price!



Unmasking the packer price!
Free range egg producers are being invited to help create a new monthly comparison guide that will detail the best and worst packer prices currently available in the United Kingdom.

With free range producers increasingly squeezed between high costs and tight returns, the Ranger magazine is hoping to help farmers get the most from their hens by compiling a comprehensive list of packer prices. The magazine hopes, eventually, to produce a league table, which will enable producers to readily find the highest prices available at any moment in time. The Ranger says the guide will provide unhappy producers with the possibility of finding a better return for their eggs.

Ranger editor Keith Wild said, “Why are packer prices secret? Producers need to know the options that are available. Some producers have no choice of packer for geographical reasons, but others have more choice than ever. One thing the Ranger can do, and producers can help us to do, is to unmask packer prices and give the sector a guide to who pays what - a league table.”

Keith said that packer prices could be confusing. Comparisons could not be easily made because some packers blurred the differences, some were stricter on seconds and some packers even had their own complicated league tables that affected the returns made to producers.

In recent years free range egg producers have been hit by huge spikes in the price of feed. With egg prices in some cases failing to match the increases in the price of feed, producers have run up heavy losses. According to costings produced each month by the British Free Range Egg Producers’ Association (BFREPA), many farmers are still losing money on their layer units. Some producers have switched to alternative packers - a number of new packers have entered the market tempting farmers with enhanced prices for their eggs - and the intention of the Ranger price comparison guide is that producers will be able to make a more informed choice about where to sell their eggs.

More than 50 producers have so far given their packer prices to the Ranger, but the magazine is urging others to take part in the initiative to ensure that the guide is as comprehensive and accurate as possible. The submitted data is currently being tested to ensure that the figures and calculations stand up to scrutiny, and to ensure that the guide is fair to producers and packers alike.

The calculations that are being carried out are based on averages - the average packer price and the average price that any producer is paid, including any premiums paid. Some packers have more than one price - a GM price, a woodland price, a well feathered price, a top twenty producer price - or just a favoured price. Some packers have one price for all. All of these prices are being averaged using the Ranger’s percentages for each grade so that the more each packer pays each producer, the higher the packer will rank in the table.

“It is fair to say that the more a packer needs your egg then the more they will pay,” said Keith. “So those new packers with newly found contracts will inevitably be at the top of the table. It is also fair to say that some small packers who pay their producers well but are not searching for new producers may also fare well in the table but the table has to be a reflection of what is available at any given time”

Producers can provide price information very simply by visiting the members’ area of the BFREPA web site - www.bfrepa.co.uk - and inputting the price they receive for each grade from their packer. Producers can also submit details by text on 07855400666. All information provided will be treated with confidentiality.

“Please don’t leave it to someone else,” said Keith. “If you want to achieve the best possible price for your eggs we must all work together as a group. Whilst the price is holding up some producers will give this initiative little thought, but those same producers may need to think again when the price is under pressure. The more producers participating, the more accurate the league table will be. Packers have seen the benefits of league tables and introduced them into their own models to encourage producers to perform better.”

The BFREPA costings are prepared and verified by ADAS, and the Ranger price used in the costings is calculated from an average of all figures from the producers and packers who have contributed. Members of BFREPA can already benchmark their egg price anonymously against the price received by other members of the association in the members area of the BFREPA website.

BFREPA are currently working towards collating the data and a consultation period will begin to determine the criteria that will make up the pricing table, this will provide an open and public comparison of the prices currently available on the egg market.

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