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Import levies protect the EU egg sector from large volumes of imports from third countries. If negotiations with non-EU countries result in reducing or abolishing import levies, competition from non-EU countries poses a threat, especially when it comes to egg powder. In a scenario with 50% lower import levies, Ukraine and the USA can offer whole egg powder at a lower price compared to the EU egg sector.
In a scenario with 50% decrease in import levies and a 10% lower exchange rate for the non-EU currencies, offer prices of egg powder of from? Ukraine, USA and also Argentina and India are below the average EU level. The ‘worst-case scenario’ consists of no import levies and a 10% lower exchange rate for the non-EU currency. In this scenario all non-EU countries would be very cheap suppliers of whole egg powder to the EU market. Offer prices could be as low as 16% (Argentina), 20% (India) to even 24% (Ukraine and USA) below the average EU level.
These findings are reflected in a study by Wageningen University & Research , for the European Egg Packers and Traders Association (EEPTA) and the European Egg Processors Association (EEPA). The report shows the impact of reducing or removing import levies on the competitiveness of the EU egg sector, for both shell eggs and whole egg powder.
Production costs shell eggs and egg powder compared
The production costs of shell eggs produced in enriched cages in the EU in 2021 was on average 0,99 euro per kg of eggs. Between the main egg producing countries, the production costs of shell eggs in 2021 ranged from 1,01 euro in Germany to 0,96 euro per kg of eggs in Poland. Compared to the average level within the EU, the production costs for shell eggs in 2021 were lower in USA (-21%), Ukraine (-19%), Argentina (-14%) and India (-15%).
For whole egg powder, the non-EU countries were even more competitive. Compared to the average level within the EU, the production costs of whole egg powder in 2021 were lower in USA (-19%), Ukraine (-17%), Argentina (-12%) and India (-15%). Because the cost of transportation of powder is low, the offer price of whole egg powder from third countries is relatively low. Current import levies protect the EU from imports from these countries.
European legislation for egg producers
In the EU, egg producers have to comply with European legislation covering animal welfare, environmental protection and food safety. The additional costs directly related to European legislation, based on the situation in 2021, are estimated to be 14% of the total production costs of eggs at farm level. The extra costs of keeping layers in enriched cages (with 750 cm2 per hen) take a large share of this increase. In Argentina, India and Ukraine there is no legislation on animal welfare and laying hens are housed in conventional cages with a space allowance of around 400 cm2 per hen. Also on environmental protection and food safety Ukraine, India and Argentina have less stringent or no legislation.
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