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January 17, 2025 11 mins
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Speaker 1 (00:00):
All right, I want to do something a little different
here now.

Speaker 2 (00:02):
I went to the supermarket not that long ago and
was looking at the egg section and there weren't that
many eggs, and what eggs were there were very expensive, right,
A package of a dozen eggs that I normally would
have expected to be four bucks with seven, and there
weren't a lot there.

Speaker 1 (00:22):
And of course everything's cage free now.

Speaker 2 (00:25):
But we've had a lot of conversations on the show
about well, what's causing this? Right?

Speaker 1 (00:30):
Is it that law? Is it bird flu is it
something else? Is it a combination? When's in it? When
is it going to get better?

Speaker 2 (00:38):
And joining us to help us understand these these questions
and their answers is Bill Skebby, who is executive director
of Colorado Egg Producers, And we're also going to talk
a horse thing with him in a few minutes as well,
because he wears a second hat. But for right now,
we're talking about eggs. So, Hi, Bill, good to see you.

Speaker 3 (00:56):
Hey, Rosk, nice to be with you.

Speaker 1 (00:58):
Happy here, Yeah, same to you, Same to you.

Speaker 2 (01:00):
So this topic is just one that's not going away,
and I'm sure it's vexing you since you represent the industry.
So why don't we just start with this basic question,
to the extent that there are multiple factors, roughly, what
percentage of the very high price we see of eggs
right now is attributable to what factor?

Speaker 3 (01:22):
I think?

Speaker 4 (01:23):
I know that the thing that is attributing to the
high cost of eggs is a shortage of eggs. We
have experienced nationwide a huge impact with avian influenza. We've
lost probably ten percent of our flock, and just this

(01:45):
week alone, I was I was reported another six million
hens have been taken out of production. So ross, you've
got to have hens to produce eggs. When you don't
have them in your productions system, you don't get that amount.

Speaker 3 (02:03):
Of eggs available.

Speaker 4 (02:05):
Eggs are sold in the commodity market, and in the
commodity market it's supply and demand, and that really, truly
is the bottom line for the shortage of eggs. Cage
free eggs have nothing to do with the shortage.

Speaker 2 (02:24):
Interesting, all right, So two things I want to follow
up on there. I'm going to do reverse order. So
it's one thing to say that cage free eggs have
nothing to do with the shortage, but that's not the
same as saying that cage free eggs have nothing to
do with higher prices. So I guess my question for
you is if there were no avian and I'm going

(02:49):
to try to if there were no avian influenza, no
bird flu right now, and I know you can only
kind of guess at this because there is bird flu
and there has been for months months now. How much
higher would our egg prices be than a year earlier
because of the cage free law, If at all.

Speaker 4 (03:07):
The cost of a cage free egg is approximately forty
six cents per dozen, a difference in them and ross.

Speaker 3 (03:18):
You're the first one I'm telling this to.

Speaker 4 (03:20):
I'm working on getting a Nielsen report from our national
organization on the Rocky Mountain region how it compares to
the cost of gigs across the country. I will be
testifying on a bill that is being introduced to repeal

(03:41):
the cage free housing law, and that would be absolutely
disastrous to our egg industry here in the state of Colorado.

Speaker 3 (03:50):
And I'll touch on that a little bit more. I'm
want to stay with your.

Speaker 4 (03:53):
Topic because I know how you can be so the
real cost of an egg is of a dozen eggs
is not going to go up that much.

Speaker 3 (04:01):
The cost of production is due to labor.

Speaker 4 (04:06):
Management of the hents because they're in an open more
open environment, and the cost of all the inflation that
we've had over the years, over the last few years, transportation,
feed cost, insurance cost, and I might have already said labor,
but there's a lot of things that are involved with it.
But ultimately, with sixty percent of the nation going to

(04:29):
cage free, are currently in cage free, the cost of
eggs is not that high compared to conventional.

Speaker 1 (04:40):
I guess that depends how you look at it.

Speaker 2 (04:42):
If if you used to be able to get a
dozen eggs, all else being equal, if a dozen eggs
used to be three bucks and now they're three point
fifty because of the cage free law, that's a seventeen
percent increase in the price of eggs. And a lot
of people eat a lot of eggs every day, and
you know, restaurants and everybody who uses eggs for everything.

(05:02):
So to have a government regulation increase the cost of
something that's used by fifty million people every single day,
that's not nothing. That's a big deal, and it's a
very significant price. And I guess that's you know, voters
are going to decide whether.

Speaker 1 (05:22):
Or or did decide whether they're willing to pay that price.

Speaker 2 (05:25):
So I don't know how many voters understood how high
the price would be. Could you please elaborate on why
a bill to repeal the cage free thing would be
harmful to our egg industry.

Speaker 4 (05:36):
Well, first off, the reason why that law came about
was because the consumers themselves.

Speaker 3 (05:42):
The consumers asked for that.

Speaker 4 (05:44):
Reports and were generated and surveys taken, and consumers wanted.

Speaker 3 (05:49):
Eggs to be in a cage free environment.

Speaker 4 (05:52):
If this law is repealed, it undermines that welfare standard
that we established back in twenty twenty. And we've done
a progress with a bill in our state was passing
twenty twenty. We worked with the Department of Agriculture, we
worked with the consumers that were asking us to do this,
and we did a phase in program that goes ahead

(06:16):
and makes it that made it start on January first,
So you have that undermines that welfare of animal standards.

Speaker 3 (06:25):
It contradicts the marketing.

Speaker 4 (06:27):
Trends and technically the consumers demand. And if we go
back to cage free, go back to conventional cages. None
of our farms are going to go back because they've
made an enormous investment in the cage free process.

Speaker 1 (06:48):
That would be that'll be fine with me.

Speaker 3 (06:50):
Dollars.

Speaker 1 (06:51):
Yeah, so that'd be fine with me.

Speaker 2 (06:53):
If companies are doing something to appeal to the consumer's
taste and the consumers want to pay like the same way.
For some reason, people think they want to buy organic
milk even though it's a waste of their money. Let
them do it, and let the egg companies market their
stuff as cage free, and people who care about that
can buy it. And in fact, you know what, at
some small price differential, I probably would pay more for

(07:15):
cage free. I don't know that I'm happy paying this
much more for cage free, but it's also not the
worst thing that's ever happened to me. But it's a
very interesting point that you make. I would rather not
have it mandated by government. Let me mention one other thing,
and then I want to talk.

Speaker 1 (07:31):
To you about horses, because we only have about three minutes left.

Speaker 2 (07:34):
I think you said that we're down about ten percent
of the flock, and some listeners might be wondering, well,
wire prices up fifty percent or eighty percent if we're
down about ten percent of the flock. And I'll let
you respond in a second, but let me just mention
one quick thing. I've done a lot of trading in
financial markets in my life, including in commodities, and commodities
are really priced on the margin, and you would be

(07:56):
absolutely shocked, for example, with oil, gasoline and other things
that people really need, how much a small shortage will
drive up the price, and also also how much a
small glut will drive down the price. Those effects are
really magnified more than you would expect if you never

(08:17):
traded these things. Do you just give me fifteen seconds
on that, and then I want to.

Speaker 1 (08:21):
Do two minutes on horses.

Speaker 4 (08:23):
Well, basically, the egg producers themselves who this law effects
are not egg egg price. They're egg price takers, not makers.
They don't make the price. The market makes the price.
So this law affects the producer, but all in all,
they take the prices to go to the commodity market

(08:47):
to sell and they have no control over it.

Speaker 3 (08:49):
Your retailers, it also depends on.

Speaker 4 (08:52):
It also depends on if your retailers want to do
a promo, do you get people in the store?

Speaker 1 (08:56):
Right?

Speaker 2 (08:57):
And again I want to move on to something else.
But it's a very important point, right. The egg producers
are not setting the prices. Exton doesn't set the price
of oil. Chevron doesn't set the price of oil. You know,
opek can try to manipulate a little bit, but the
market decides the price.

Speaker 1 (09:14):
You bill. Another hat that you.

Speaker 2 (09:16):
Wear in addition to being the executive director of Colorado
Egg Producers is president of the Equine Heritage Foundation. And
I literally have about seventy five seconds here, but you
wanted to just talk briefly about the new Horse Protection Act.

Speaker 1 (09:32):
Can you just tell me whatever you want us to know.

Speaker 4 (09:34):
Yeah, I'll tell you real quickly on that one, and
thank you for entertaining this. The Horse Protection Act actually
started in nineteen seventy and I had to deal with
the process or technique of soaring horses to get action
out of their feet in the show or reno. The
new twenty four amendments to the Horse Protection Act. Really,

(09:55):
we are opposing it because it proposes amendments that could
significantly diificantly expand the federal oversight into areas that are
already effectively managed by state.

Speaker 3 (10:07):
And local entities.

Speaker 4 (10:08):
And this also increases a great cost to equine activities,
especially for those people that have young people getting involved
that are enjoying horses because they love the horses and.

Speaker 3 (10:20):
They like what they're doing.

Speaker 4 (10:22):
And the new amendments are they offer some ambiguity in
the enforcement provisions.

Speaker 3 (10:29):
And the cost of these smaller shows and.

Speaker 4 (10:32):
Activities to have the USDA group come out and inspect
horses and inspect facilities. This cost that the industry cannot
absorb and it's going to really be very, very detrimental
to our entire equine community.

Speaker 2 (10:49):
Well, with this incoming administration, you'll probably find so much
more sympathetic voices. I'm sure you're going to be getting
in touch with members of Congress or the Secretary of
whatever who is relevant to this. These provisions that the
Biden administration is putting in aren't supposed to take effect
for a couple of weeks, and it wouldn't surprise me
if you end up making a difference in winning this thing.

Speaker 1 (11:11):
I got my fingers crossed for you.

Speaker 4 (11:13):
Well that's why I came to you, Ross, because I
know you have listeners that listen, and I need people
to be listening to this so they can tell their
horse lover friends, Hey, pay attention.

Speaker 3 (11:22):
This affects you very good.

Speaker 1 (11:23):
Yeah.

Speaker 2 (11:24):
For folks who love horses, go look up the new
Horse Protection Act rules that are supposed to take effect
in a couple of weeks and learn more what.

Speaker 1 (11:33):
Bill's talking about.

Speaker 2 (11:34):
Bill Skebby, Executive director of the Colorado Egg Producers, Thanks
for your time and information.

Speaker 1 (11:39):
As always,

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