Wednesday, February 28, 2024

Why 2024 is going to be … Incredible

By Emily Metz American Egg Board

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CHICAGO — I think we can all agree that 2023 was a challenging year for eggs, but whatever our concerns, the egg industry has good reason to be very optimistic about the future. Your American Egg Board (AEB) is moving aggressively on multiple fronts to ensure security and prosperity for America’s egg farmers in 2024 and beyond.

As we head into the holiday home stretch, I’d like to highlight three important initiatives that will figure prominently in the year ahead.

 

Cage-free transitions

The AEB is supporting America’s egg farmers through what may prove to be the biggest evolution in our industry’s history. Many of our producers have already or are in various stages of transitioning some or all of their operations to cage-free housing in response to new laws and customer needs. At the current pace of growth, by the end of 2025, cage-free production will represent more than half of the U.S. egg supply.

In fact, the cage-free egg supply has increased by more than 400 percent in the past decade — a figure that has far exceeded actual consumer demand for cage-free eggs.

America’s egg farmers have always evolved and adapted their businesses to align with both customer orders and consumer purchasing at retail, and they have taken responsible, deliberate actions to ensure a steady supply of cage-free eggs in consideration of changing demand. Even so, demand for more affordable, conventional caged eggs remains steady. Egg farmers know they must meet true demand for all types of eggs.

Converting existing operations or building new cage-free housing is the single largest investment an egg farmer may ever make. This is one of many reasons transitions to cage-free must be done in close collaboration with egg customers at retail and foodservice. Further, cage-free eggs typically cost more to produce, and the costs of inputs such as labor and feed are often higher. That’s why maintaining choices in the egg case is important. While eggs are invaluable, AEB’s consumer research and intelligence clearly show that many consumers — and customers — want the most affordable option in the case.

To that end, AEB is carefully monitoring and providing tools and resources for producers, customers and industry partners to navigate the evolving landscape, while also supporting those who are transitioning to cage-free egg supplies to comply with new state laws or to meet established transition deadlines.

For the past year, our team has also been developing a comprehensive communications strategy for leading the industry smoothly through these transitions — encompassing scenario planning, messaging development, consumer education, and media and customer engagement — and we are implementing it now. Rest assured that all egg producers, regardless of production system, will have the support and air cover needed to succeed in this changing environment.

 

Exports growth

The export market for shell eggs and egg products is a significant and largely untapped opportunity. Compared to other commodities, America’s egg farmers have almost literally kept their eggs all in one basket — the U.S. domestic market. While the U.S. now exports more than 20 percent of its pork and 18 percent of its dairy, U.S. egg industry exports for the past decade have only accounted for about 3.8 percent of total table egg production annually on average. Our due diligence and data indicate U.S. egg producers are missing a potentially huge opportunity to grow their businesses through exports.

In addition to delivering value to producers via sales growth, this is also about managing risk and delivering greater stability through diversification. We have more than 300 million egg laying hens in commercial production here in the U.S. — that’s nearly one bird for every American — that collectively produce nearly 100 billion eggs annually. Those birds do not come equipped with an on/off switch. By establishing strong, ongoing, long-term business relationships with overseas customers, we can mitigate domestic seasonal demand spikes and ensure that our eggs always have a home.

This past November, AEB personnel and nine producers from across the country spanning a variety of farm sizes and production types undertook a trade mission to South Korea and Japan, where we toured wholesale markets, and met with major retail and manufacturing customers, as well as trade officials at our embassies, to gain a better understanding of the opportunities in these markets.

This trade mission reflects a new strategic direction for the U.S. egg industry focused on deliberate and accelerated growth in exports. Through this determined focus on exports, the AEB seeks to roughly double the average annual U.S. egg exports to 7 percent of total table egg production within the next five years. This is an ambitious, but achievable goal that our producer leadership and my team and I believe is fundamental to the prosperity and long-term stability of U.S. egg producers and the industry.

While there is ample opportunity for shell eggs, the near-term focus is on egg products due to their versatility, functionality and transportability, but U.S. eggs and egg products both have an advantage over eggs and egg products sourced elsewhere in the world because they are heavily regulated and produced according to some of the highest quality and safety standards on the planet, and they perform consistently in formulation. Customers overseas understand the advantages of U.S. eggs and egg products, and they are hungry for them.

The AEB is driving this effort by focusing on three critical areas: Trade capacity building, international market insights and prioritization of market opportunities. We want the global egg market to have increased access to what we believe are the best eggs in the world, produced by America’s egg farmers with care every day.

But one of the main hurdles to growing our egg exports is honestly just securing producer interest. I am pushing our egg producers hard to embrace this opportunity, and these trade missions are an important component to helping our producers see the opportunity. We are already planning our next trade mission to key target markets in the first half of next year, and I am excited to expose U.S. producers firsthand to the incredible growth potential these markets present.

 

Officially healthy

The egg’s stellar nutritional profile is one of its greatest strengths with consumers today. And though we’ve come a long way from the cholesterol scare of decades past, our consumer insights team uncovered that cholesterol still represents a significant barrier to consumption — surprisingly enough, among parents with young children. Our research also told us that messages from the American Heart Association are highly credible to consumers and can significantly impact intent to consume eggs. So we entered into a three-year partnership with AHA to educate consumers — and their physicians — to shift the narrative on eggs and cholesterol.

In its first year, the campaign was very successful with activations during September/National Cholesterol Education Month spanning broadcast TV and radio and social media to reach millions of consumers, while also educating medical professionals about the latest research via AHA’s continuing education module. Our next activations are planned for American Heart Month in February.

The work we are doing is having an impact — we are shifting consumer perceptions about eggs and cholesterol. The AEB’s heart health content successfully increased favorable perceptions of eggs among the exposed consumer audience by an astounding 15 percentage points. Those exposed to heart health content were also seven percentage points more likely to completely agree that eggs can be part of a heart healthy diet. These are big numbers.

But perhaps the most promising development ahead may rest with the U.S. Food and Drug Administration, which is expected to issue a highly anticipated final rule on what foods can call themselves “healthy” in 2024 — possibly as soon as April. If the new rule proceeds as currently written, we will be able to unequivocally state in our marketing and communications — and on pack — that eggs are “healthy.”

This could be a potential game-changer for the entire industry. We have a cross-functional team hard at work preparing to take full advantage of this opportunity the moment it breaks across audiences, establishing the egg once and for all as a nutritional giant among foods.

As I said, we have good reason to feel good about the year ahead. Wishing you, your loved ones and your coworkers and employees the most joyous holidays and a happy, healthy, prosperous new year!

 

Emily Metz is president and CEO of the American Egg Board headquartered in Chicago, Ill. For more information, visit www.aeb.org.

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