Subscribe
Jobs
Cars
Real Estate
Apts
Classifieds
Shop
TOPEKA – The brown hens stopped pecking and scratching at the dirt as 5 p.m. approached. They drifted back into the barn, where dinner was about to be served.
The 19,500 chickens living in this southwestern LaGrange County barn are pretty ordinary, but consumers are willing to shell out a premium for the eggs they lay. That’s because the hens are free to roam around the barn and fenced areas outside, instead of being kept in cages.
As consumers become more aware of their food’s origins, some choose to buy cage-free eggs produced at the LaGrange County farm and similar operations. Although debate rages about whether this egg production method is better, it is clear that demand for cage-free and organic eggs is rising.
One of the nation’s leading cage-free egg producers wants to add 20 more barns in northeast Indiana this year to help meet that demand. Egg Innovations LLC already has 31 contract farms in the region, said Mike Carter, live production manager. The company is hosting farmer recruitment meetings in New Haven and Nappanee this week.
Egg Innovations moved into Allen County in the past year, signing up four farms to raise chickens on a contract basis. The company also has contract farms in LaGrange, Kosciusko and Whitley counties and plans to keep growing its presence in the region, company president John Brunnquell said.
In these contract relationships, Port Washington, Wis.-based Egg Innovations provides the birds and pays farmers a fee for every dozen eggs they produce. Area farmers finance the barn construction and provide the labor. The farmers give the eggs produced to Egg Innovations, which then sells the eggs to grocery stores, restaurants, hotels, natural foods stores and membership warehouses such as Costco. Egg Innovations typically charges double the wholesale price for conventional eggs, Brunnquell said.
Privately held Egg Innovations does not disclose its revenues or how many birds it has, but it added 300,000 chickens this year. Those birds will lay an additional 7.5 million cage-free eggs next year, Brunnquell said.
Demand is rising at the retail level. Food sales tracking firms do not monitor sales of cage-free eggs specifically, but organic egg sales for the year ending Aug. 11 increased 23.4 percent from the previous year, according to Nielsen LabelTrends, which tracks manufacturing labeling trends. Stores sold 27.9 million dozen organic eggs during the 52-week period ending Aug. 11. That was up from nearly 22.7 million a year earlier. Nielsen LabelTrends tracked sales at food, mass merchandise and drugstores, with the exception of Wal-Mart Stores Inc.
Organic eggs made up only 1.6 percent of the egg sales Nielsen LabelTrends tracked last year, but the niche is growing. Two years ago, less than 1 percent of egg sales were organic eggs.
Cage-free eggs are not necessarily organic eggs. To be considered organic eggs, the chickens must not be given hormones, antibiotics or chemicals. The farm also must undergo an organic certification process.
Three Rivers Food Co-op sells about 250 dozen eggs each week that are either labeled cage-free or certified organic, grocery manager Rosemary Mausser said. Demand is steadily growing because consumers want natural, local products, Mausser said. The store’s cage-free eggs, priced at $2.45 a dozen, come from northwest Ohio farms.
Grocery stores typically charge $2.99 to $3.29 for a dozen cage-free eggs, Brunnquell said. The cost of a dozen conventional eggs varies based on the market but is currently around $1.39.
Consumers who find cage-free egg production methods more humane are willing to pay for the higher farming costs, Brunnquell said. Egg Innovations farmers spend about $30 a bird to build a chicken house. A conventional barn, in comparison, would cost about $8 a bird, he said.
A cage-free barn is larger, which increases the costs. Chickens at an Egg Innovations farm have about 300 square inches of space each, Brunnquell said. A bird raised at a commodity operation might have 80 square inches, he said.
Egg Innovations addresses chickens’ needs for ventilation, water quality and nutrition, “and we don’t have to cram them into a facility that only gives them a sheet of paper for their living space for an entire year,” Brunnquell said.
Research has shown either caged or cage-free environments can be healthy for chickens, said Gene Gregory, president and chief executive of United Egg Producers, an Alpharetta, Ga.-based industry trade association. Both approaches have advantages and disadvantages. Keeping birds in cages can prevent the spread of soil-borne illnesses, he said. Cage-free operations run the risk that chickens will lay eggs near manure, creating the risk of salmonella or other bacterial contamination.
Glenn Miller has avoided those problems at the southeastern LaGrange County chicken barn he built this year as an Egg Innovations contract farmer. The hens are trained to lay eggs in a designated nesting area, away from manure. When Miller is ready to move the eggs to the front of the building, he turns on a conveyor belt.
The chickens “can be inside, they can be outside,” he said. “They can do whatever they want. It’s a nice setup.”
An estimated 5 percent of egg-laying chickens are being raised at cage-free farms, Gregory said. He thinks that figure has grown from 2 percent during the past five years. Consumer demand is fueling the trend, he said.
Restaurants, hotels and other institutional customers are increasing orders of cage-free eggs, Brunnquell said. Egg Innovations supplies eggs to Omni Hotels, which announced in April that it would shift to serving only cage-free eggs. Fast-food chain Burger King is starting to buy some cage-free eggs.
Three Rivers Food Co-op customers prefer the taste of cage-free eggs, Mausser said. After they switch to organic or cage-free eggs, they don’t want to eat conventional ones, she said.
“After a while, you get pretty spoiled,” Mausser said.
Still, not all institutions are making the switch. The University of Notre Dame researched cage-free and caged operations, but the university opted to stick with egg suppliers who use cages, Gregory said. The industry will continue to meet consumer demand for eggs produced both ways, he said.
Cage-free eggs, with their premium prices, are creating opportunities for small, family farms, Brunnquell said. That is one of the reasons he started Egg Innovations on his family farm in Wisconsin.
The cage-free market gave Miller, the LaGrange County farmer, a way to start a farming operation. Miller, who is Amish, works at a recreational vehicle factory and wanted to do more farming. He had kept 10 to 20 chickens at his home. Egg Innovations offered him a way to farm part time on his 10-acre property.
“I think it’s a good, growing business,” he said.
jglenn@jg.net
