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Local egg prices hold steady, despite flu

Lead Summary
By
Mavis Fodness

With egg prices doubling in the last 30 days, some local retailers are not passing the added costs on to local consumers.
Glen Gust, owner of Glen’s Food Center in Luverne, said the price for a dozen eggs rose from less than $1 to more than $2 in recent weeks.
Eggs recently received good health reviews, increasing consumer demand, he explained. Demand coupled with a decrease in egg production has led to the recent price climb.
Since the highly pathogenic avian influenza (HPAI) H5 was first detected in Minnesota earlier this year, more than 9 million turkeys and chickens have been destroyed, including 3.6 million from egg production sites, according to the Minnesota Board of Animal Health’s website.
The decline in numbers was also seen in the latest Chicken & Eggs report through the National Agricultural Statistics Service. Minnesota produced 11 million fewer eggs, a 14-percent drop from the previous month and a 4-percent drop from a year ago.
While egg prices have increased, poultry meat prices are slower to react.
Nathan Kraft with W-2 Quality Meats, a meat market in Luverne, said chicken prices have not increased, but one product jumped up $3 per pound.
Smoked turkey tenders increased to $12.99 per pound, a cost that won’t be passed on to customers since the store has a good supply.
Kraft sees the retail price increase as short-term.
“We are just going to ride it out,” he said.
William Lazarus, University of Minnesota Extension economist, said industry experts indicate the poultry industry will bounce back quickly, with 2016 egg production forecast at increasing 2 percent.
The same positive forecast is seen for the broiler industry, as affected barns repopulate with new stock.
Lazarus, however, downplays the positive outlook.
“If it turns out to be a one-time event that goes away and doesn’t come back ... ,” he cautioned.
“I understand that the veterinarians are not sure about the likelihood of recurrence at this point.”
The avian flu outbreak has helped small producers (those with flocks of 100 birds or less) gain a foothold in the local retail market.
Business for Fick’s Farm Fresh Eggs has picked up in recent months, even before HPAI H5 was detected in the state.
“People started wanting more,” said Payton Fick of his five years in the egg production business. “They wanted farm fresh.”
The 16-year-old saw the demand expand beyond sales to family, friends and neighbors earlier this year to customers who were interested in purchasing produce knowing how the food was raised.
Fick’s 30-hen flock is allowed to free-range on their farm south of Luverne and nest in a large homemade chicken coop. Fick’s flock used to be larger, but many hens were butchered when egg production exceeded sales.
On a monthly basis Fick estimates he sells 240 eggs. With demand he was able to double his price of a dozen eggs to $2.
He is considering the increase in flock numbers despite concerns that the avian flu may return.
“I don’t think it will strike mine,” Fick said. “We don’t have many water fowl around our farm.”
According to the USDA, wild migratory birds primarily spread the virus, whose deadly effects lessened as the weather became warmer.
For now, however, some food suppliers are limiting the supply of eggs to restaurants. Some restaurants reportedly have been limited, increasing the price of or removing food selections containing eggs.
Luverne restaurant manager Cody Scholten of Papa’s Place has avoided those scenarios.
“We were notified from our supplier we couldn’t get any more (eggs),” he said. “But we haven’t reached our limit.”
The restaurant uses as many as 1,200 eggs per week to prepare homemade bakery goods and menu offerings.
“We haven’t had any significant (price) increases to pass on to customers,” Scholten added.
Which may be due to local chicken processors such as Gold’n Plump (GNP), whose two primary plants in Cold Spring, Minnesota, and Arcadia, Wisconsin, process 2 million chickens weekly. Its plant in Luverne further processes product from those two plants.
The Luverne plant hasn’t experienced the interruption in supply that other companies have experienced. The interruptions in other plants have led to worker layoffs and reduced hours.
 “This is because the GNP Company has not had any confirmed cases of the virus and our chicken flocks have not been affected,” said plant manager Greg Aubert.

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