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Coles’ free-range headache

Coles has been attempting to win customers with its animal-friendly, farmer-unfriendly policies

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COLES is now discovering the ephemeral nature of the support of animal rights and consumer advocates.

Having wooed them with populist policies imported from the UK such as no hormone growth promotants in beef and no sow crates for pigs, it has blown it with its policy on free range eggs.

Free range eggs account for over a third of the total egg market. Coles wants to retain what it regards as the appropriate moral ground and has replaced cage eggs with barn-laid eggs in its home brand range. It now wants to establish its own standard for free range eggs.

The problem is, there are widely varying opinions about what free range ought to mean. Moreover, some of those with a different view from Coles have little tolerance for those with whom they disagree.

And whereas the cost of producing eggs under Coles’ definition would not cause a dramatic increase in prices, prices would rise enormously if produced under other definitions.

Currently there is no national standard for free range egg production. There is a voluntary standard that specifies 1,500 hens per hectare, and a couple of states have legislated this level, but it is widely ignored. In practical terms, eggs sold as free range may originate from hens housed at densities anywhere between 750 and over 30,000 per hectare.

Last year the Australian Egg Corporation (AEC) sought to introduce a certification trademark for free range eggs based on 20,000 hens per hectare. It based this on consumer market research that indicated the public viewed it as consistent with what free range means.

Following concerted opposition by consumer and animal rights groups, and in the wake of a highly prejudicial opinion from the ACCC, the proposal was dropped. Thus nothing changed except that there was now a well organised lobby continuing to insist that free range should mean 1,500 hens per hectare, with some groups (including the NSW Greens) preferring 750.

Now Coles has told its egg suppliers that they must stock their hens at no more than 10,000 per hectare if they want to sell their eggs as free range through its stores.

In economic terms, this is eminently practical. A free range density of 750 or 1,500 hens per hectare would force egg prices up to as much as $12.80 per dozen, according to an independent economic assessment for the AEC. While a density of 10,000 means production costs are higher than cage production, many consumers are willing to pay a small premium for eggs labelled as free range.

But the free range lobby is not interested in consumers and egg prices. Its ranks comprise boutique producers who sell their eggs at premium prices (in local markets, not supermarkets) and do not want large producers competing with their business; consumer groups that claim consumers don’t care about the price of free range eggs; and animal rights advocates who fundamentally disagree with using animals for commercial purposes.

These people will not allow Coles to implement its free range strategy without serious opposition. Being a big company is usually enough to set them off, but a big company that challenges their values so profoundly is guaranteed to become a target.

That will be more than a little ironic. After all, Coles has been attempting to win customers with its animal-friendly, farmer-unfriendly policies. Instead, the company can look forward to adding to an already substantial list of antagonists.

  • David Leyonhjelm has been an agribusiness consultant for 25 years. He may be contacted at reclaimfreedom@gmail.com
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    READER COMMENTS

    John Newton
    7/03/2013 5:28:17 AM

    David, as you know, the AEC is dominated by large - read caged - egg producers and they were dragged kicking and screaming into the free range arena. Secondly, I'd love to know the question asked of the consumers who supported the 20,000 per hectare proposal. Thirdly, there is nothing inconsistent or ephemeral about those advocating for the animals we eat being looked after. Farmers has obligations to the animals they raise to look after them, to feed them well and to make sure they have a good life before their one bad day. They are not merely units of production.
    Chookie
    7/03/2013 6:50:09 AM

    " ....animal-friendly, farmer-unfriendly ...." says it all! We demean ourselves and our society when we ignore cruel treatment of animals.
    Bruce C
    7/03/2013 6:50:53 AM

    It is truly wonderful to see these Free range hens free to roam with 19,999 other happy little hens in their happy hectare. But wait a minute, these hens should not be denied sex. A happy hen must have her natural desires satisfied. I hope Coles management is not a misogynist lot. How many roosters will become the free love standard in our free range hen utopia ? What a tangled web you weave when first you practice to deceive - especially when you are trying to deceive 20 million customers.
    morrgo
    7/03/2013 7:03:34 AM

    "Free range" at densities required for profitability equal to cage-kept is a travesty in animal-welfare terms. Not only that: the hygienic handling of cage-produced eggs cannot be equalled in any other technology but the most boutique, labour-intensive situations. Thus, Coles' cynical marketing drive has public-health implications that need thorough assessment.
    Lucy
    7/03/2013 7:53:21 AM

    Consumers have to realise that they need to pay for good quality food. Ethical and healthy farming mean good quality food. 20000 chickens per ha will not produce healthy food!
    Matt12
    7/03/2013 8:49:38 AM

    Don't confuse chooks with humans as the animal huggers obviously do, chooks only need 3 things, food, shelter and security, the rest is just window dressing.
    cv
    7/03/2013 11:03:56 AM

    Matt12, you clearly have no idea about raising animals. e.g. chicks living in high density situations where their bedding isn't regularly cleared out end up getting lacerations in their lungs from breathing faecal dusk. They then get infections which require antibiotics to stop them dying. You then eat these birds with their faecal contamination and cocktail of antibiotics. Now lets looks at cattle in feed lots. They are stocked so tightly that one animals head is literally on the others backside. Have you ever seen a cow defecate? Don't get me wrong I eat meat daily, only I eat quality meat.
    daw
    7/03/2013 11:23:30 AM

    When it comes to chooks most comments are about animal welfare with no mention about the environmemt. Graziers with cattle or sheep are according to the Nat. Veg Act required to maintain ground cover at or above 70% so shouldn't free range chook farmers be required to ensure this same level in order to protect the soil? If they are, then I suggest that an appropriate density of the order of 1000/ha will stand a far better chance of maintaining soil cover.
    Genazzano
    7/03/2013 12:40:40 PM

    Daw - lets put the Nat. Veg Act on your land so you have no property rights and then see how you react - people who live in glass cages
    daw
    7/03/2013 1:41:31 PM

    Genazzano, your too late, it's already on my place and my son's and many farmers who haven't cleared all their native vegetation and what I said above would only put them on a par with us ie they'd have no rights either. Where were you when we were fighting for our rights? Nowhere to be seen. Our cattle and sheep don't go round scratching the surface of the soil and killing seedlings or burrowing holes to dust bake in the sun or picking at soil biota, earth worms and the like.
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    Agribuzz with David LeyonhjelmCommentary, news and analysis with agribusiness consultant David Leyonhjelm. Email David at reclaimfreedom@gmail.com

    COMMENTS

    light grey arrow
    I like Bill Heffernan and he has some valid points. We should tighten international tax treaties
    light grey arrow
    He represents the future of agriculture in this country, wtf, and the future of agriculture is
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    some will say their best years have been el nino ones