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Mecardo Blog

How to deal with animal activists: A lesson from the egg industry

Posted by Robert Herrmann on 20 April 2016
Robert Herrmann
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The egg industry is a good example in how to deal with Animal Activists, and perhaps it can provide some ideas for the Australian wool industry around how to respond to the mulesing debate.

The production of cage eggs and the subject of mulesing have been easy targets for the radical activists, however the end result to each industry is starkly different.

When producers are asked, both industries are adamant that their practices (cages and mulesing) are not only humane, but actually improve the welfare of the bird/sheep.

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From day one, the egg industry has treated the free range egg as a premium product and therefore a more expensive product. This was not only a marketing decision – albeit a much smarter decision than allowing the cage eggs to become a discounted product – it was also based on the cost of production. Free range eggs have a higher cost for a range of reasons; higher capital setup costs (sheds); higher bird mortality (disease, predators) and lower per bird production.

This was not only a marketing decision – albeit a much smarter decision than allowing the cage eggs to become a discounted product

The wool industry on the other hand, left it to the market to price non-mulesed wool and to determine a premium over other wool. This premium has either (a) been too slow coming, or (b) has not been enough as the volume of non-mulesed wool has grown at snail’s pace.

Customers

The egg industry is effectively a domestic market, so any customer response is immediate. Importantly the egg industry was also in possession of customer survey data; shoppers prefer to buy free range eggs but only when they can afford them. In fact, there were a lot of shoppers who through their buying decisions were not too concerned about the issue. So today you see on the supermarket shelf cage, barn & free range eggs, all priced differently. The consumer can decide how concerned they are about welfare and buy accordingly or they can just buy to a price.



ACTIVISTS_2.jpgBecause the connection to the customer in the wool industry is dis-connected via many third parties and distance, it was the activists who were able to make the running and frighten the retailers and by default the customers. Given it was a pretty easy goal; just put up a photo of a recently mulesed lamb and any rational argument that came along later would struggle to resonate. The other factor was that as a risk management policy, the retailer could decide to either abandon wool (there are plenty of alternatives) or certify it as non-mulesed – anything to remove the threat of angry protestors scaring off customers.

Response

Granted it is easier for the commercial egg industry to connect with its customers, although it is usually via the retailer. This pathway has proved to be a surprise advantage for the producer, because the retailer has responded to concerns around cage eggs by driving the supposed demand for free range.

An interesting situation for egg farmers evolved; supermarkets “announced” to suppliers and customers that they would not stock cage eggs post 2017 – this was a fait accompli and the supermarkets retired very comfortable that the customer would now be pacified.

It was some time after this pronouncement that the supermarkets became concerned that there wasn’t nearly enough investment in new free range production. There was a risk that they wouldn’t have enough eggs and their customers would have to go elsewhere.inline_egg3.jpg

Egg producers have a range of customers and not all are as difficult as the supermarkets, so the pronouncement firstly wasn’t a great threat to their sales and it is also a time when egg consumption is rising. Secondly the egg producer was wary of converting his cheap production system into the new more expensive model on the say-so of the supermarkets.

The end result is that supermarkets are now offering a guaranteed price with long term contracts for the supply of free range eggs. The farmer is able to respond to the demand, and shore up his business investment via contracts.

Supermarkets are now offering a guaranteed price with long term contracts for the supply of free range eggs

The wool industry has responded to the threat around mulesing in three ways. One is the wool grower who takes the customer requirement for non-mulesed wool on board and has altered his management accordingly to produce it. The other two responses have a similar result; one to tell the customer to “get stuffed” – “we won’t be told how to run our farm or what is best for our sheep”. Finally there is also a large group who are just ignoring the issue and hope it will go away.

A better result.

What if the Australian Wool Industry, or the representative body, had seen this coming? Could something have been done? It would have been interesting if the wool industry had mounted a pre-emptive campaign promoting the way Australian wool producers manage the welfare and husbandry of their flocks; promote this message alongside the “clean, green” wool story. The possibilities mount up as do the positive messages that could have been announced.

Sadly, there either wasn’t any idea this negative campaign was coming or the industry didn’t think it was going to carry much weight. Our first response was to threaten PETA with court action; that was a bit like kicking an own goal. PETA love this publicity and revel in it as it increases their revenue opportunities.p-lamb.jpg

Wool and eggs are different, and their market places are also different. That said, both employ commercial practices to enhance welfare and productivity that the modern consumer struggles to understand. Both also are required to deal with the wider population who don’t appreciate the finer points required in the production phase to successfully produce fibre and food.

The egg industry has embraced the changes required by customers and will supply whatever quality they demand; but the price reflects the difference. This means the consumer is taking responsibility for his/her welfare concerns by selecting the free range option or not.

The wool industry is moving slowly to provide non-mulesed wool via chemical products and sheep selection/breeding (wrinkle free). At the same time, it is trying to change the consumer perception, it’s a bit like the boy with the wheelbarrow – he has the job in front of him!

At Mecardo, we have worked out what premium is required for wool growers to switch to non-mulesing and we invite you to view this analysis by clicking on the button below. 

What premium is needed for un-mulesed wool?

 

Topics: Wool industry, Australian wool industry, animal rights