Las Vegas, Nevada – In 2021, with egg prices comfortably below $2 per dozen, Nevada implemented a cage-free egg law, reflecting a growing concern for animal welfare in several states. However, a sharp rise in egg prices, now nearing an average of $5 per dozen due to a persistent bird flu epidemic, has prompted Nevada to pass a new legislation. Signed into law by Governor Joe Lombardo this Thursday, this legislation allows a temporary suspension of the cage-free requirement, aiming to alleviate the financial burden on consumers.
This suspension is a remedy that other states, also with cage-free laws, have hesitated to adopt. The law’s relaxation may increase egg availability in Nevada, though the total supply remains constrained. A significant factor is the bird flu outbreak which has led to the culling of nearly 159 million birds since 2022. The disease mandates the culling of entire flocks when detected, heavily impacting the egg supply chain.
The effectiveness of relaxing cage-free regulations on egg prices is uncertain. Poultry farmers, who have invested billions in transitioning to cage-free environments, face challenges in reverting to conventional methods. Even if the regulation was universally rescinded, demand from large corporations like McDonald’s and Sodexo for cage-free eggs would sustain high prices.
According to Jada Thompson, an agricultural economist at the University of Arkansas, allowing a broader range of eggs into Nevada’s market might slightly stabilize prices locally but could exacerbate the situation elsewhere given the tight supply chain.
Nevada is navigating this unique approach as states like California, Massachusetts, Washington, Oregon, Colorado, and Michigan have not indicated plans to revert their cage-free regulations. Moreover, states such as Arizona, Rhode Island, and Utah have similar laws that will be enacted in the coming years.
Assemblymember Howard Watts III, a Democrat who initially supported the 2021 legislation amidst his chicken-rearing activities, highlighted the unforeseen impact of the bird flu on supply chains. Governor Lombardo’s approval and the forthcoming suspension by the Nevada Department of Agriculture, anticipated to take effect imminently, will be a test of this legislative flexibility.
Despite a 120-day suspension period, the impact on grocery store prices is expected to be seen within 30 days, as noted by department spokesperson Ciara Ressel. The current price surge is unprecedented since a similar bird flu outbreak in 2015, with some areas like California experiencing prices as high as $12.99 per dozen.
Cage-free eggs come from the roughly 121 million out of 304 million egg-laying chickens nationwide. These eggs often meet the supply demands of restaurant chains and grocers under long-term contracts aimed at curbing cost fluctuations. The transition from traditional to cage-free practices has been significant over the years, yet the total supply still falls short of the demand.
The impact of bird flu is particularly severe on cage-free farms, where biosecurity measures are harder to enforce compared to more confined environments. Should these farms be hit, the alternatives for replenishing egg supplies become limited, extending the recovery period significantly.
While states like Michigan dispel the notion that cage-free laws have spiked prices, others are observing the situation in Nevada before making any legislative reversals. Resistance is substantial, specifically where voter-approved measures are in play, illustrating the complexities of balancing animal welfare with economic and health crises.
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