2120 final report.pdf - Agra CEAS Consulting

THE SOCIO-ECONOMIC IMPLICATIONS OF THE VARIOUS SYSTEMS TO KEEP LAYING HENSS1. Executive summaryThis study assesses the socio-economic impact of Directive 1999/74/EC and in particular thepotential implications of the 2012 ban on traditional caged production. It has been conducted in linewith the Terms of Reference of a contract issued to Agra CEAS Consulting in late 2003.The study was conducted in the period October 2003 to December 2004 1 and involved extensivedesk as well as field research in all EU-15 Member States as well as in five third countries (Brazil,India, Mexico, Ukraine and the United States). Limited additional research was also undertaken inrespect of Poland and Switzerland. During the first phase of the research data was collected on thestructure of the egg production sector in each EU-15 Member State, the main operators and levels ofconcentration in the sector, costs of production by type of production system as well as trade andmarket demand.Similar differences are apparent in the type of egg production systems which prevail. While thetraditional battery cage remains the predominant production system across the EU accounting forover 85% of laying hen places (apart from Sweden where national legislation has banned the use ofsuch cages), in some Member States (e.g. Austria, Denmark, Ireland, Netherlands, Sweden and theUK) alternative non-cage systems now account for a substantial (in Sweden’s case over 50%) share ofoutput. This is in marked contrast to the position in the third countries reviewed where, apart fromthe voluntary adoption of limited animal welfare improvements in the US, almost all commercialoutput takes place in battery cages with space allowances per bird often below the 550 cm 2 currentlyused in the EU.The evidence collected during this stage highlights the fact that due to their differing historicalevolution and legislative frameworks, production structures and the prevalence of particularproduction systems varies widely between Member States. Thus some Member States (e.g.Germany, UK, Netherlands and France) show a high degree of vertical integration along the chainfrom producer to packer to processor. These Member States will also generally tend to haverelatively large production units (as do Italy and Spain) while in other Member States productionunits tend to be more fragmented and less integrated (e.g. Austria, Greece, Ireland, Portugal).In terms of production costs there are also significant variations between Member States, but moreimportantly between different production systems. Thus the traditional battery cage which hasevolved over the past three decades has a substantial advantage in cost terms over alternative noncagesystems (barn, free range, organic) largely due to lower labour, land and feed requirements.Little evidence on costs for commercial production from enriched cages as required by Directive1999/74/EC is as yet available, but the limited evidence obtained from producers with experience of1 The study therefore commenced before the ten new Member States entered the Community on 1 May, 2004 and consequently a fullindustry profile is not presented for each of these countries.v