Happy hens, expensive eggs

If you’ve been in any California grocer’s egg aisle lately, you may have noticed two new additions to the cartons: the CA SEFS stamp, and the rising prices that came with it. The stamp (which stands for California Shell Egg Food Safety Compliant) indicates which eggs meet the regulations of Proposition 2, a California initiative that went into effect Jan. 1.

Prop 2, which was heavily lobbied for by the Humane Society, requires that all eggs sold in California now come from hens provided with “adequate” living conditions. In specific measurements, adequate translates to at least 116 inches of space for hens to fully extend limbs and turn around easily, as determined by studies at UC Davis. The proposition, which also applies to calves and pigs, has taken seven years to implement, but was passed in 2008, with more than 60 percent of the vote. And while this might be better news for chickens, it means the egg industry is, ahem, scrambling to deal with the consequences.

Prop. 2 may have little effect on current “range free/organic” egg companies. But, as all California farmers must now comply with the new standards, many have chosen simply to reduce flock size to allow for the space. With fewer hens available to lay eggs, the cost has skyrocketed significantly. At Chico’s Mangrove Safeway, Lucerne brand eggs are currently sold for $5 a dozen, up from 2014’s average of $2.20, according to Bureau of Labor Statistics. Even our 99 Cent Store can’t afford to keep its current prices under $2.49 per carton. And while Prop. 2 may be responsible for the most recent price increases, it’s only one of many factors contributing to the egg industry’s current state of turmoil.

“With the drought, and freezing temperatures, it’s been rough,” said Malinda Stamy, sales representative at ProPacific Fresh. And with cold winter temperatures, hens lay eggs less frequently, further contributing to the decline. As Durham’s wholesale food distribution center, ProPacific serves as one of the primary egg sources for Chico restaurants, with many businesses buying them by the case load at 15 dozen eggs per case. “We haven’t lost business yet, but people are shopping around,” Stamy said.

Two such restaurants supplied by ProPacific are Sin of Cortez and Beatniks Coffee House and Breakfast Joint, both of which heavily rely on egg dishes for their breakfast menus. “We go through 15 to 20 cases of eggs a week,” Sin of Cortez owner Danielle Ius said, noting that 19 out of 30 of her entrees are egg-based. “When I was comparing prices around town, I noticed that in some places, it went from $19 a case to $58 —literally overnight. Right now I’m getting the best deal, but it’s still a lot. If things stay the way they are, we’re talking about a $30,000-$40,000 increase in egg purchases for one year.”

With recent cost increases so dramatic, business owners are struggling to find a solution, but eliminating eggs from the kitchen isn’t one of them. “It’s taken years to build our clientele; they’re used to what we offer, and it doesn’t make sense to take eggs off a breakfast menu,” said Mike Cress, co-owner of Beatniks. “At least 75 percent of our menu items have an egg on them.”

Some restaurants have chosen a direct approach, letting the customers know the effects that the new prices bring to business. Kalico Kitchen owners hung a sign outside their restaurant informing patrons that a 30 cent increase will be added to egg orders.

For some, the solution is to use a different product. “A lot of people are turning to the liquid egg,” noted Stamy. “It didn’t get affected by Prop. 2.” A popular cooking option for food-service businesses, the liquid egg is roughly 90 percent egg processed and pasteurized with non-egg ingredients as well. Some local businesses aren’t ready to turn to that just yet, however.

“I’m not using those now—we want to use real eggs,” said Ius. For Cress, using local or organic eggs would be ideal, but “we go through so many eggs daily that it’s just too expensive.” But with Prop. 2, the gap in prices between free-range/organic and regular eggs is diminishing. For now, though, Cress said they’re still not the best deal.

California egg brokers are looking for out-of-state options when it comes to dealing with the egg shortage, although any states making deals with California businesses still must meet the CA SEFS regulation, a standard that isn’t implemented on a nationwide scale. For ProPacific, sourcing eggs from Willamette, Ore., is the current answer, while some other Chico businesses, such as S&S Organic Produce and Natural Foods use suppliers such as Judy’s Organic Eggs from the Petaluma area, which wasn’t affected by Prop. 2, having already met the cage regulations.

While the state of the egg industry is in flux, the only way many local businesses are dealing is by eating the extra expenses, for now. “If this is just going to be a temporary blip, we’ll suck it up so we don’t have to pass it on to customers,” said Cress.

Ius has similar sentiments. “When you have a business, the cost of everything goes up constantly. Until I know what’s happening, I’m not going to raise prices,” she said. “For now, we’ll just have to wait it out.”