Egg producers are battling against the odds in the current market climate.
With output dwindling, egg supplies become tighter, and the wholesale market climbs ever higher – but producers are not making any money.
See also: Inflation puts egg farmers on ‘brink of bankruptcy’
Production costs are rising sharply across the board, but the vast majority of the industry is locked into contracts that are failing to keep up.
In the wholesale trade, free-range prices are back to their high point of Christmas 2020, while colony egg has climbed to a record level.
The gap between the two sectors has now almost vanished in the wholesale trade.
However, not much egg is moving around at these prices, reports the CEA, and there is very little available anyway, especially on the colony side.
Losses from avian influenza and early depletions, combined with plummeting pullet placings, have substantially reduced the size of the laying flock and, in the case of pullet numbers at least, are set to reduce still further.
“Colony seems to have disappeared off the face of the earth, and free-range is tight enough,” said Andy Crossland at CEA.
“We desperately need retail prices to move on and give room for the market to operate.
We hear time and again that wholesaler customers are going to retail because it’s cheaper than buying through wholesale,” he said.
“I’ve not seen a market like this at all, and costs keep on rising.
“It’s not just feed and birds, it’s fuel and labour and packaging, it’s a difficult time.
“We are hearing reports of producers not re-stocking, and I can see the UK flock as a whole shrinking through this year.
“Hopefully, the industry can get the prices it needs from retail, and we can pass it on to packers and producers alike.
“There could be supply shortages if we don’t remedy that,” said Mr Crossland.
According to latest Defra figures for pullet placings, the UK flock is due to cut another 1.5m birds between now and July.
It means that the number of birds in their first year of lay is set to drop to 35.1m in the summer, a fall of 4m from the peak flock in December 2020.