Organic Hen Eggs from Free-Range Systems: A.S
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Organic hen eggs from free-range systems: A.S. Tserveni-Gousi et al. Organic hen eggs from free-range systems: economics of production and marketing A.S. TSERVENI-GOUSI1*, A.L. YANNAKOPOULOS1 and E. SOSSIDOU2 1Department of Animal Production, Veterinary School, Aristotle University of Thessaloniki, 541 24 Thessaloniki, Greece 2National Agricultural Research Foundation, Animal Research Institute, 581 00 Giannitsa, Greece *[email protected] Keywords: organic eggs; free range system; marketing; Greece Summary Organic eggs from free-range systems are those produced by hens fed rations having ingredients that were grown without pesticides, fungicides, herbicides or commercial fertilizers. This survey aims to analyze the profile of a free-range farm producing organic eggs under Greek conditions of production and marketing. The data concerning the production and marketing were derived from a Greek farm which produces organic eggs using the free-range system. Data has been collected and analyzed over a period of 52 weeks (one year). The analysis of the data gained under the study resulted to the following: The number of the produced eggs was 195.6 eggs/hen while the number of the eggs sold totalled at 158.65 eggs/hen. The additional food intake was up to 28.79 kg/hen that is 27.3% less than the intensive poultry production. The cost related to the pasture rent and the labour, consisted the 18.84% of the total production cost, while the feeding cost consisted 45.04% (27% less than the intensive poultry production). The total production cost was 16.84 euros/hen with a profit of 12.78 euros/hen. At the end of the laying period, hens came on the meat market and offered an important return (13.52% of the total income). Finally, the egg market in two major cities of Greece, Athens and Thessaloniki, presented two peaks over the year: 1st April (Easter) and in the beginning of autumn (consumers’ return from summer holidays). On the contrary, in Myconos (Cyclades) and Ithaka (Eptanysa) islands, the sales of these eggs showed peaks in July and August, due to the increased number of tourists. The economic outlook for the production of organic eggs in free-range systems in Greece is quite satisfactory. Moreover, the Greek market for organic eggs opens up new prospects. Introduction Recent food scares in Europe have increased egg consumer concern about what they eat and how it has been produced. These conditions have driven to less intensive systems of egg production. Organic or alternative egg production (free-range, aviaries etc.) has increased continuously over the last decade, without, however, reaching higher market shares; the contribution of these eggs to overall production differs considerably among EU member states (Windhorst, 2004). According to the USDA report, egg production growth constrained in the EU-15 (old Member States) by higher production costs and lower margins; however, the EU-N10 (new Member States) were expected to gather pace due to relatively favourable production conditions related to a good environment for investment, proximity to important consumer markets and a strong domestic market (USDA, 2005). The development of EU organic or alternative egg production could be strongly influenced in the near future by Eastern Europe countries. Already, countries like Hungary are exporting organic poultry products. Free-range production presents an alternative to factory farm poultry and eggs that conveys a positive image of animals living outdoors as “nature intended”. The term “Free Range” refers to those hens that are not confined to large indoor commercially intensive batteries. In general, these eggs are more expensive than eggs from hens fed conventional feed due to higher production costs and lower volume per farm. Also, according to Emous and Fiks-van Niekerk (2004) there are some issues that restrain farmers from switching battery cages in to alternative systems (free-range): more labour is needed, the number of floor eggs increases, management is more difficult; as a result, eggs are more XI th European Symposium on the Quality of Eggs and Egg Products 379 Doorwerth, The Netherlands, 23-26 May 2005 Organic hen eggs from free-range systems: A.S. Tserveni-Gousi et al. expensive. According to Thear (1997) the average price of free-range eggs is 35p a dozen above that of battery produced eggs. Generally, organic egg production means that birds are produced under free-range conditions but with lower stocking densities. Organic hen eggs from free-range systems are eggs laid by free-range hens, which are allowed to roam outdoors, and feed freely on a certified 100% organically grown grain based diet. The hens, that lay organic eggs, also enjoy more space than other free-range chickens both inside the houses (5 birds per square metre) and outside (4 metres squared per bird). Poultry production can be a profitable enterprise for organic farmers and eggs are a popular product that can be sold through many outlets - locally and nationally. However, chickens have particular management requirements that may not be obvious to the inexperienced producer. In Greece, organic production only recently became the focus of significant attention from governmental and private organizations, consumers and farmers (Fortomaris et. al., 2004). From the total of Greek poultry enterprises, only 48 are the organic ones certified by three private certification and inspection organizations (Dio, Biohellas and Physiologiki), whereas 83 enterprises are certified by the national organization (Agrocert) for their special poultry farming products as free range products, or products produced under certain nutritional methods (Fortomaris et. al., 2004). The annual increase for the year 2002 was 106% for the total number of poultry reared organically. Moreover, the trade of organic poultry products is limited into specialized stores, as well as large supermarkets located in urban area markets mainly. There is no reliable information available about the economy of production of organic hen eggs from free-range systems in Greece. This survey aims to analyze the profile of a free-range farm producing organic eggs under Greek conditions of production and marketing. The information is designed to give an idea of the potential earnings that can be achieved from becoming an organic free-range egg producer. Materials and methods The data concerning the production and marketing were derived from a Greek small scale farm which produces organic eggs using the free-range system and has been certified by a recognized organization (“Physiologiki”). Data has been collected from a total number of 2,500 hens over a period of 52 weeks (March 2002-March 2003) in order for the costs and returns to be estimated and the constraints in egg production to be found out. A special, exclusive, natural feed has been developed for the hens using organically certified grains, with no animal by-products and residue from pesticides, drugs or other chemicals. Also, this hens' cereal diet, which was available for them to peck at constantly, was free from GM ingredients and artificial yolk colorants. Rotated paddocks allowed continual access to fresh, unsprayed, green herbs and grass, which made up 70% of the hen's natural intake. Free range hens were raised outside, on fresh green pasture, in small groups, protected by medium size pens. Pop holes were created, to allow hens access to the inside range where egg nests were provided. The housing conditions (outdoor and indoor space requirements), as well as animal care, disease prevention and veterinary treatment were laid out according to EU regulations for free-range (EEC-Regulation 1274/1991 and EC 2295/ 2003) and organic production (EEC-Regulation 1804/1999). The eggs were collected by hand three times a day. This number as well as the number of sold eggs, the additional food intake and mortality were recorded on a daily basis. The produced eggs were sold to retailers or directly to the final consumer at local markets. The areas of sales and the price of sold eggs were recorded. Results and discussion FINANCIAL RESULTS The production expenditures, the gross income and the net profit of organic free-range eggs during the flock cycle (52 weeks) are illustrated in Tables 1, 2 and 3 respectively. XI th European Symposium on the Quality of Eggs and Egg Products 380 Doorwerth, The Netherlands, 23-26 May 2005 Organic hen eggs from free-range systems: A.S. Tserveni-Gousi et al. Table 1 Production cost (euros) of organic free-range eggs. Item Total Per hen Per m2 of pasture 1. Land (pasture) Rent 275.69 (0.74)* 0.12 (0.71) 0.02 (1.09) 2. Labour Family 2,235 (6.03) 1.02 (6.06) 0.11 (5.97) Other 4,476.02 (12.08) 2.03 (12.06) 0.22 (11.89) 3. Capital (fixed and variable) Feed 16,694.86 (45.04) 7.58 (45.02) 0.83 (44.88) Pullets 6,461.08 (17.43) 2.94 (17.46) 0.32 (17.31) Variable (electricity etc.) 1,179.08 (3.18) 0.54 (3.22) 0.06 (3.26) Preventive medication 323.08 (0.87) 0.15 (0.89) 0.01 (0.55) Taxes 555.65 (1.50) 0.25 (1.49) 0.03 (1.66) Depreciation (eg. building) 3,081.67 (8.31) 1.40 (8.32) 0.15 (8.16) Insurance etc. 1,069.27 (2.88) 0.47 (2.79) 0.056 (3.07) Certification fee (“Physiologiki”) 521.53 (1.42) 0.24 (1.44) 0.03 (1.67) Miscellaneous 193.83 (0.52) 0.09 (0.54) 0.009 (0.49) TOTAL PRODUCTION COST 37,066.76 (100.00) 16.84 (100.00) 1.85 (100.00) *Figures in parentheses indicate percentage to total Table 2 Gross income (euros) of organic free-range eggs.