May 14, 2003 No. 29
Don Bell’s Table Egg Layer Flock Projections and Economic Commentary - 2003
(This report was written by Don Bell, University of California Poultry Specialist, emeritus, under the sponsorship of United Egg Producers)
Evaluating Eggs of Differing Sizes
Relative to the
Weight and the Price of Large
Eggs
Several years ago we had the opportunity to visit an egg processing
company in Japan where we observed the normal sizing of eggs into separate
categories, but with different prices per carton based upon individual carton
weights. In other words, a series
of cartons could all be “large”, but each carton would have a different selling
price - based on its weight. This
not only reflected the value of weight, but allowed eggs of a common size to be
grouped together as it is in the U.S.
Since this visit, we visited a supermarket in the Midwest region of the
US that was selling a container of eggs based purely upon the net weight of the
purchase at so much per pound. If
the consumer wanted 7 eggs and they weighed 14 ounces, the price was based upon
this weight. The buyer chose the
eggs they wanted from a stack of filler flats. Interestingly, you could mix brown,
white, x-large and medium eggs all in the same purchase.
In most developed nations, eggs are categorized into 5-6 size groupings
and each size is priced differently.
In addition, price relationships between sizes will change from season to
season based upon the relative proportion of each size. Variability in individual eggs within a
category is perfectly normal and must be allowed. In different countries weights normally
vary within categories from 2-3 ounces per dozen or 5-7 grams per egg. In the US, tolerances for variation are
defined for the consumer carton.
For example, samples may contain 3-5% of the next lower weight category,
but there are no limits on placing larger eggs in a container marked as a lower
weight dozen.
In a 1996 National Study of eggs in the marketplace, large eggs were
sampled in 115 stores in 38 cities.
Individual one-dozen weights (white eggs, without the carton) ranged from
24.7 oz./doz. in Pennsylvania
to 25.6 oz./doz. in California. Shell color had no effect on the average
one-dozen weight with both white and brown eggs averaging 25.2 oz./doz. Individual cartons with one or more eggs
below the minimum weight (below 23 oz./doz.) averaged approximately 5% with no significant
differences between regions or shell color groupings.
The 0.9 oz./doz.
difference between California’s large eggs and those produced in Pennsylvania
probably reflect the higher use of flock recycling in California and/or
different State minimum weight standards.
For example, California graded eggs (not USDA) may all weigh 23 ounces/12
per egg with no per dozen requirement, whereas the USDA and other agencies
require a 24 ounce dozen weight as well.
Using the assumptions listed in
Table 1, the average farm value of the different graded large egg weights by
state are shown. (assumption:
large & above @ 50˘/dozen, medium @ 37˘/dozen).
Table 1. One-dozen
egg weights (large) in U.S. supermarkets - 1996
|
State |
Av Wt (g/egg) |
Av. Wt. (oz./doz.) |
Case Wt. (lbs.)* |
Farm price (cts/doz.) |
|
CA |
60.5 |
25.6 |
48.00 |
46.70 |
|
IL |
60.3 |
25.5 |
47.85 |
46.62 |
|
NC |
59.8 |
25.3 |
47.46 |
46.37 |
|
PA |
58.4 |
24.7 |
46.35 |
45.71 |
|
Tx |
59.1 |
25.0 |
46.91 |
46.90 |
* based upon next run eggs at the listed case weights -
same average weight, but different ranges in weights between graded and not
graded eggs.
Regardless of the reason for packing larger eggs in the large carton, the
producer price represented in the California large carton was 46.7 ˘/dozen
compared to 45.7˘/dozen in Pennsylvania. This reflects the heavier one-dozen
weights observed in California supermarkets and the inclusion of more extra
large eggs in the large egg packs.
Pricing Eggs of Different
Weights
The price of the different sizes usually does not represent a comparable
price per unit of weight - neither on a monthly or annual basis. Based upon absolute weight differences,
the figures in Table 2 illustrate adjustments required for the various sizes to
result in comparable prices per pound.
Table 2. Egg price adjustments relative to prices for large eggs
(equivalent prices based upon weight).
|
Egg Price* (Large eggs) (25 oz/doz) |
Jumbo (31 oz/doz) |
Extra Large (28 oz/doz) |
Medium (21 oz/doz) |
Small (18 oz/doz) |
|
$.45 |
+$.108 |
+$.054 |
-$.067 |
-$.126 |
|
$.50 |
+$.120 |
+$.060 |
-$.080 |
-$.140 |
|
$.55 |
+$.132 |
+$.066 |
-$.088 |
-$.154 |
|
MW UB (2002) |
+$.074 |
+$.029 |
-$.136 |
-$.283 |
|
MW UB (2001) |
+$.053 |
+$.020 |
-$.140 |
-$.272 |
* Farm, wholesale or retail
Based upon the
data shown in Table 2, if large eggs were valued at $.50˘/dozen, extra large
eggs should be priced 6.0˘/dozen higher or $.56/dozen. Based upon
UB MW prices for 2002 and 2001, extra large prices were only 2.9˘ and 2.0˘/dozen higher
or $.529 or $.520 respectively.
What Is The Effect of Pricing
Policies on Net Egg Prices?
Modern strains of White Leghorn
layers produce more than 80% of their eggs in large, extra large and jumbo
categories. The distribution of
weight classes is dependent upon strain, definition of weight classes, and the
replacement program used. Today’s
strains of layers differ in their ability to produce large eggs. A recent study of more than 400
white-egg flocks showed a range in average case weights from 45.8 to 48.2 pounds
per case through 60 weeks of age.
Assuming 20 dozen eggs by this age, this would represent 28˘/hen or
1.4˘/dozen differences in egg value.
Tables 3 and 4 illustrate the typical yield of the
various categories of size for different periods of time in dozens and
percentages.
Table 3. Egg size distribution for various replacement periods. (Dozens)
|
To Age (weeks) |
J |
Ex. Lg. |
Lg |
Lg & Above |
Med |
Small |
Pee Wee |
Total |
|
60 |
1.00 |
6.08 |
8.51 |
15.59 |
3.69 |
1.01 |
.08 |
20.38 |
|
70 |
1.91 |
8.61 |
9.66 |
20.19 |
3.77 |
1.01 |
.08 |
25.05 |
|
80 |
3.11 |
10.99 |
10.53 |
24.63 |
3.82 |
1.01 |
.08 |
29.55 |
|
65 + 40 |
4.70 |
15.73 |
12.84 |
33.27 |
3.99 |
1.02 |
.08 |
38.48 |
* based on size alone - undergrade eggs would usually be subtracted from the larger
sizes. Classes are based upon
minimum individual egg weights.
Table 4. Egg size distribution for various replacement periods. (%)
|
To Age (weeks) |
Jumbo |
Extra Large |
Large |
Large & Above |
Medium |
Small |
PeeWee |
|
60 |
4.9 |
29.9 |
41.7 |
76.5 |
18.1 |
4.9 |
.4 |
|
70 |
7.6 |
34.4 |
28.6 |
80.6 |
15.1 |
4.0 |
.3 |
|
80 |
10.5 |
37.2 |
35.6 |
83.3 |
12.9 |
3.4 |
.3 |
|
65 + 40 |
12.2 |
40.9 |
33.4 |
86.5 |
10.4 |
2.7 |
.2 |
In general, producers receive the same price for large, extra large, and jumbo eggs.
This policy effectively penalizes the production of these larger sizes
and is why many producers attempt to maximize their egg weights between 48 and
50 pounds per case. If prices were
adjusted to reflect weight values, higher case weights would be justified. Table 5 illustrates the effects of
different pricing policies on average egg values for one and two cycle
management programs.
Table 5. The effect of pricing policy on average egg prices and egg income
per hen.
|
To Age (weeks) |
(no
premium) Lg+ =
50˘ Med =
37˘ Small =
15˘ |
(+2,
+2) J =
54˘ X Lg = 52˘ L =
50˘ M =
37˘ S =
15˘ |
(+5,+5) J =
60˘ X Lg = 55˘ L =
50˘ M =
37˘ S =
15˘ |
Dozens |
|
Av egg price (˘/doz) |
|
|
|
|
|
80 |
47.0 |
48.1 |
49.8 |
29.55 |
|
65+40 |
47.5 |
48.8 |
50.7 |
38.48 |