1. Presented By: Brian Eivers Sales Director The Nest Box Egg Co. Ltd
Enriched v Conventional Laying Cages – Managing the transition of the Cage ban: 2012
Presented By: Brian Eivers
Sales Director
The Nest Box Egg Co. Ltd

2. Introduction
Thank you for the opportunity to share with you my experiences of the 2012 “battery” or conventional cage ban
We are a second generation family owned business with 40 years experience in the production packing and processing of free range, enriched cage and organic eggs
Employ 50 people who grade 3,000,000 eggs each week for the Irish, UK and Middle East market
20% market share of the retail and foodservice market in Ireland

3. What was ‘2012’? The welfare of laying hens directive
On the 1st January 2012, all standard 550 sq cm battery cages became illegal for egg production, and a 750 sq cm cage (termed the enriched cage) was the minimum allowed for caged egg production
ENRICHED CAGES

4. What was ‘2012’? The welfare of laying hens directive
The cage ban was absolutely not welcomed by our industry. It was seen as change for changes sake.
Huge investment of €30 per bird was required, this in a period when banks were insolvent. Would the market give a return?
This gave rise to huge decisions for producers and was quite a stressful period for individuals and companies.
However, the legislation was clear in its requirement.

5. Producer Options Cease production Change to an Enriched cage model
Producers had one of five choices, each with production consequences regarding volume and pricing per unit, as well as investment consequences:
Cease production
Change to an Enriched cage model
Change to a Barn production model
Change to a Free Range production system
Change to an Organic production model

6. Irish Production – Number of Laying Hens
Egg production in Ireland – The Challenge
Irish Production – Number of Laying Hens
Farming Method
No. of Farms
No. of Hens
& % Production
Av. Hens / Farm
Cage 85
1,200,000 & 61%
14,117
Free Range
130
700,000 & 36%
5,385
Organic 22
60,000 & 3%
2,727
Totals
230
1,960,000
8,347
Total market value*: €77.5m
*Kantar world panel Jan 2011

7. Will the banks provide finance?
Considerations for investing
Decision
What so Retailers want
What do Food service and catering customer want
What the Legislations require
What do Irish shoppers want
Will there be a grant?
Will the banks provide finance?

8. The way forward
Following consultation, it was evident that the demand for caged egg production would stay
40% grant to help with the building of new facilities
The Department was open and supportive, realising the extent of change imposed. As there were relatively few projects, the Department personnel knew them individually
Some producers chose not to continue in production with others willing to invest more. This led to significant consolidation

9. The Way Forward - Financing the Move
Banks were not in a mood to lend money due to the recent financial crash
This was made more difficult and painstaking as banks had not lent money to the cage sector in many years
Detailed and comprehensive business plans were required in some cases, which was yet another challenge
Significant level of security required which included personal guarantees, access to the grant, a signed packing station contract and own funds in varying proportions

10. 2012 Enforcement
On the 1st January 2012 all battery cage eggs were illegal. This was policed and enforced in the strictest sense by the Department
This placed a lot of pressure (some would say focus!) on the industry to be ready. Old system had to be out and new system in at a very precise point in time
There was severe market disruption as 2011 saw effectively two caged production systems producing side by side leading to surplus eggs. In 2012 this reduced to one leading to massive shortages
This created market instability and placed significant strain on the industry and its customers. This was short term however

11. Post 2012 Challenges
Enriched colony system still suffers from a poor image from consumers
Industry would have a high opinion of the system but unfortunately not shared outside the system
Recent announced move from all of the UK retailers from caged eggs to “cage free”
Remains to be seen what happens in the ROI

12. 2012 Results
Producers numbers fell, and flock sizes increased leading to economies of scale, savings in labour, efficiencies at producer and packing level as well as distribution efficiencies
The industry was left with a brand new system with brand new technology which offers better control to the producer delivering better production results
We are now producing eggs as we want to. A better environment for both animal and human
2012 provided an opportunity to catch up other countries in terms of scale which would have intimidated before

13. Irish Production – Number of Laying Hens No. of Hens & % Production
Where we are now
Irish Production – Number of Laying Hens
Farming Method
No. of Farms
No. of Hens & % Production
Av. Hens / Farm
Cage 37
1,877,594 & 57.5%
50,746
Free Range
159
1,274,715 & 39%
8,017
Barn 7
36,660 & 1.1%
5,237
Organic 26
79,095 & 2.4%
3,042
Totals
229
3,268,064
14,271
Total Bird numbers: 3.27m (1.96m 2010)
Total market value*:
€119.7m (+54%)over 2011
*Kantar world panel Jul 2016

14. Thank you
and
Questions