Competitiveness Of The EU Egg Industry

In response to 2012 legislation requiring higher welfare standards for egg laying hens, the European Union of wholesale eggs, egg products, poultry and game (EUWEP) commissioned a report to determine the competitiveness of the European egg industry, particularly in light of proposed reductions in import tariffs. Fifteen percent of EU egg producers’ costs are spent meeting EU legislation, an increase of over 6% from prior to the 2012 legislation. The cost of production in the US is 25% lower while it is 28% lower in Argentina, though the cost of importing leaves these eggs uncompetitive in the EU. However, if import tariffs are lower, eggs, and in particular egg powder, from countries closer to Europe will be more competitive and cost less than eggs produced in the EU.

Report Summary:

“Egg producers in the EU have to comply with legislation dealing with environmental protection, animal welfare and food safety. From 1 January 2012 keeping hens in conventional cages was prohibited and egg producers had to change to either enriched cages or alternative housing systems. The result of all this legislation is an increase in the cost of producing eggs. At the same time the EU is negotiating with other countries or groups of countries to liberalise trade in agricultural products. These multi- or bilateral negotiations are designed to further liberalise trade by either further reducing import tariffs or removing them altogether.”

“In this report the impact of lowering import tariffs on the competitiveness of the EU egg industry is studied. The results show that the offer price of whole egg powder in 2012 of some third countries is close to the average EU price. Despite the current import tariffs on whole egg powder, the third countries can be competitive on the EU market. In a scenario with a 50% lower import tariff, all third countries have a lower offer price of whole egg powder compared to the EU egg industry.”