Third of price increase vanishes

More than a third of the price increase paid to producers in the past four months has already been wiped out by increased costs.

That is the picture to emerge from the latest BFREPA costings which show that although free range farmers are at last making money the big question is "for how long?"

The BFREPA figures show that an average flock is now recording a margin of 5p per dozen. This follows a total of 7.5p per dozen increase in the price paid by packers since last October. But at least 2.6p of that increase has been swallowed by the latest rises in feed and pullet costs.

The cost of producing a dozen eggs is now 64.39p. Of that feed accounts for 27.18p (43 per cent), pullet 10.98p (17 per cent), labour 12.41p (19 per cent) and depreciation of buildings and equipment 6.13p (10 per cent). Electricity charges account for 1.63p per dozen while other costs such as vet bills, cleandown, litter, range management and rodent control total 5.3p per dozen.

So although the price received for eggs rose by 10.9 per cent, last year's costs rocketed ahead by at least 6 per cent. For the moment the BFREPA figures show an overall margin of £1.25p per bird.

"With costs, particularly feed, rising so fast that margin will soon be eaten into," said vice-chairman John Widdowson," and we have to remember that producers are still paying off the debts incurred in the earlier part of last year when many were operating at a loss."