Rabobank: US egg industry’s strategic reinvention

by consumer demand, regulatory changes, and retail consolidation. The transition, which required massive capital investment and redefined supply chains, offers critical lessons for the entire animal protein industry facing increasing regulatory and consumer pressures. The move to cage-free eggs was largely initiated by regulatory changes, notably California’s Proposition 2 in 2008, rather than purely by consumer demand. This led to a fragmented rollout of state policies and individual customer mandates, creating significant challenges for producers. Smaller producers often struggle with the conversion costs of new production systems but could become more competitive in niche, branded areas, the report notes. The financial cost of this transition was substantial, with Rabobank estimating production costs rose between 13% and 26% compared to historical averages. Furthermore, the complexity of aligning customer commitment timelines with actual implementation schedules complicated ...