washingtonpost.com > Business > Local Business
Page 2 of 2   <      

Egg Prices Leave Consumers Clucking

A look at how eggs are mass produced, from the henhouse to quality control. High egg prices and consumer demand are good news for area farmers, but tough on consumers. Video by Michael Laris/The Washington Post Editor: Francine Uenuma/washingtonpost.com

With the market "way high," Sunnyside's 430,000 hens are producing more than 8 million dozen eggs a year, part-owner Donald Lippy said.

"If that goes for a while, you make good money. You make real good money," Lippy said. "But then you go to the other side of it, and you give it back. It's another typical farming deal."

Prices have gone in cycles, often dropping so low that farmers have had to unload their eggs below cost. In recent years, such losses have squeezed many out of business.

"Sometimes it gets to be survival of the fittest," said Gabe Zepp, an agriculture official in Carroll, which produces 10.6 million dozen eggs. Sunnyside's operation is the largest still standing in the county. In Hampstead, distributor Sauder's Eggs stays busy washing eggs and using glowing lights and ultrasound to check for cracks.

Many U.S. producers who stayed afloat cut their number of chickens.

In 2005, Hibberd trimmed his flock from 160,000 to 4,000. "You couldn't justify operating it," he said.

At the same time, most U.S. farmers, feeling pressure from animal welfare advocates at home and in Europe, have been voluntarily cutting the number of birds kept in a typical 24-inch by 20-inch cage.

Together, the cutbacks, resulting in 5 million fewer hens nationally, helped bring about today's spike. Fewer eggs equals higher prices.

Feed costs are up, too, pushed by overseas demand for grains and corn-hungry ethanol producers. And bills are higher for the fluorescent henhouse lights and fuel.

But energy costs affect everybody, said Dave Harvey, a USDA poultry and fish farming analyst. "Eggs have gone up a lot more than most other things," he said. "It's a combination of lower supplies and high export demand -- those are the big things right there."

J┬┐rgen Fuchs, an international egg trader based outside Frankfurt, Germany, whose father started the business to fill shortages after World War II, watches world markets and relies on timing and connections to buy low and sell higher.

In January 2007, a dozen eggs were selling in U.S. stores for $1.55, cheaper wholesale. The eggs that Fuchs bought last year from U.S. producers ended up on the plates of diners in Hong Kong and the Middle East.

Now, "the market is so high, nobody can pay these prices," Fuchs said.

Seizing the opportunity, Hibberd, although still in debt, added 20,000 hens in October. He enjoys working with the birds, which bob and squawk all day like scratchy chorus singers. "At night, there's no sound. I always loved that," Hibberd said. "You walk in after dark, and they're sleeping. They purr."

Norma Jean Young is still buying three to four dozen a week, but she is changing the way she manages the family's food.

With her husband's income as a lawyer and her nurse's salary, the family is comfortable but careful about spending. Their prescription co-pays are higher, their oldest son starts college in the fall and a recent trip to BJ's warehouse in Alexandria for groceries hit $450. "Our food bill has climbed, and our bag count has gone down," Young said.

So if her four boys want frozen pizza, and it's not on sale, they must track down the coupons. She has stopped taking the kids to the food aisles with her because she feels uncomfortable saying no. She's trying harder not to let produce go bad and points out leftovers on plates. And she is quietly holding back a few eggs on big Sunday breakfasts for six.

"If you had a whole big smorgasbord, you would crack 14 or 16 for scrambled eggs, in addition to pancakes or whatever you're making. Now I pretty routinely go about 10," Young said. "I'm buying more at the need level than at the want level."

<       2

© 2008 The Washington Post Company