Pressure on egg farmers intensifies as grocers, restaurants pledge cage-free

More restaurants are pledging to use cage-free eggs only.
More restaurants are pledging to use cage-free eggs only.

By Alison Martin

Cage-free could be the way to be.

For grocery chains and fast-food giants, it’s the wave of the future as more and more companies pledge to sell and use only cage-free eggs.

Last week, Kroger Co. – the largest supermarket chain in the country – announced 100 percent of its eggs sold would come from cage-free hens by 2025. In September 2015, McDonald’s Corp. announced it too would progress toward using only cage-free eggs at all of its 16,000 North American locations over the next 10 years.

Other fast-food chains plan to join this trend. Taco Bell Corp. says its 6,000 locations will use cage-free eggs only by the end of this year. Dunkin’ Donuts LLC, TGI Fridays Inc. and Jack-In-The-Box Inc. plan to be cage-free in 2025–the same year as McDonald’s–while Starbucks Corporation, Panera Bread Company and Einstein Bros. Bagels – owned by Einstein Noah Restaurant Group, Inc. – have a 2020 deadline. Cheesecake Factory Restaurants Inc. plans to announce a timeline to move to cage-free.

But where is this cage-free trend coming from and how will it affect businesses down the line?

The term “cage-free” refers to a method of housing the hens who lay the eggs. Traditionally, hens were confined to “battery cages” – which are usually so small that hens cannot stand up straight, walk around or stretch their wings.

“It would be like living in an elevator packed shoulder to shoulder for your entire life,” Matthew Prescott, senior director of food policy at the Humane Society of the U.S., said.

In cage-free operations, hens have the freedom to walk around a large enclosed space such as a barn, though they are not allowed to go outside.

Rod Wubbena, the second-generation owner of Phil’s Fresh Eggs in Forreston, Illinois, says the trend gained the biggest momentum in 2008 when California passed Proposition 2, which banned the sale of any eggs that came from chickens in battery cages. Gov. Arnold Schwarzenegger signed the proposition into law, and egg producers that operated within the state or sold to it had five years to meet the new law’s standards.

But California is egg-deficient, meaning its demand for eggs is higher than egg producers in the state can meet. Most of its eggs come from states like Iowa, which produces almost one out of every five eggs in the U.S according to the Iowa Egg Council‘s most recent data. In order to sell to California, egg producers in Iowa and other states needed to meet California’s new standards or else lose valuable customers.

Now that buyers are going cage-free, traditional egg producers must transition to cage-free or risk losing businesses. Jayson Lusk, an agriculture and economics professor at Oklahoma State University, says going cage-free can be costly, which could adversely affect farmers.

“It’s probably 20 to 40 percent more expensive in terms of cost of production,” he said.

Upfront costs could include building new barns and reconfiguring old barn structures to be cage-free, plus the greater long-term cost of labor, which could play the biggest role in affecting the quality of life for the hens and the quality of their eggs.

Prescott, however, says most large egg producers have already transitioned to cage-free operations, and he doesn’t think new cage-free producers will struggle with higher production costs or transitioning to a cage-free operation.

In open areas, cleanliness, ventilation and pecking order become major concerns for farmers. When chickens move around, their dust and feces move with them. Hens in dirty enclosed spaces will be laying eggs in their own feces and dirt, but cleaning these spaces is harder and requires more labor.

Chickens are also highly social creatures, and leaving them all open to walk around with each other leads to problems.

“There are bully birds that might peck on other birds,” Lusk said.

Because of cleanliness and pecking problems, Lusk went on, cage-free operations usually have higher rates of mortality, and cage-free chickens are less productive than caged chickens, which means the egg producer will need more chickens to meet demand.

Though Phil’s Fresh Eggs has been cage-free since 1959, Wubbena says being cage-free doesn’t always mean that the hens are treated more humanely or the eggs are of better quality.

Indeed, he may have a point. An article by the Humane Society of the U.S. states that both battery and cage-free hens may “have part of their beaks burned off, a painful mutilation.” This practice is called debeaking, but it is not the same as the similar practice of beak trimming.

Wubbena likens beak trimming to “clipping a fingernail.” His farm trims hens’ beaks to prevent pecking problems, and the Humane Farm Animal Care organization considers it humane. The non-profit organization awards its widely accepted “Certified Humane Raised and Handled” certification to any livestock or poultry operation that meets its standards of care “from birth to slaughter.” Phil’s Fresh Eggs has this certification.

Humane Farm Animal Care makes a clear distinction between debeaking and trimming, but the Humane Society does not. Prescott says the society would “recommend an alternative,” but the group’s main concern is getting chickens out of cages.

When it comes to the quality of the egg, Wubbena says the hen’s diet plays the biggest role. If cage-free hens aren’t getting the nutrition they need, their eggs won’t be any more nutritional.

“There’re good and bad producers in all areas of egg production,” he said.

Cage-free operations can also have negative environmental affects. According to the Coalition for Sustainable Egg Supply, cage-free operations have a “substantially worse” impact on the environment when it comes to PM – particle pollution or “particulate matter” – emissions. When egg producers don’t dispose of feces and dust properly, they can pollute surrounding soil and water sources.

“No system is superior to another in all respects,” Lusk said, “and there are tradeoffs and costs with each.”

Wubbena warns Kroger, McDonald’s and their newly cage-free producers to watch out.

“The egg producers that are jumping into this to meet the demand have no experience with cage-free,” he said. “We had to go through the learning curve. No one told us how to do this.”

What Wubbena would like to see is a better public understanding of cage-free operations and the egg industry as a whole.

“It’s a complex issue that people are not informed about,” Wubbena said. “They don’t understand the whole story.”

More restaurants are pledging to use cage-free eggs only.