Select Committee on Agriculture Appendices to the Minutes of Evidence


Annex 3

Letter from the Chief Executive of the BEIC to Rt Hon Richard Caborn MP, Minister for Trade, DTI

WELFARE OF LAYING HENS AND THE WORLD TRADE ORGANISATION

  Thank you for your letter of 23 February 2000, in response to a copy of a letter to the Rt Hon Nick Brown MP which I sent to you.

  In your letter, you point out that our next meeting with Nick Brown will provide an opportunity to raise the issue of the WTO and animal welfare standards. I must inform you that the British Egg Industry Council (BEIC) has raised this matter on many occasions with Nick Brown and the Minister is well aware of our concerns. He was fully supportive of the BEIC writing to you to seek a meeting to discuss the issues in more detail.

  I am aware that you recently met both Compassion in World Farming and the RSPCA who have been working with us on this matter. However, I believe that it is important for you to appreciate that the issue of animal welfare and the WTO is not just of concern to welfarists. If animal welfare is not recognised and pursued through WTO, there is a real chance of parts of the UK egg industry disappearing through the lack of a level playing field.

  The egg industry is the first to be put in this unique position, but others will follow. For us, the EU has already agreed radical new welfare standards through the Council of Agriculture Ministers, There is, therefore, not an option open to us of not progressing towards implementation of these new rules.

  Of the 270 million laying hens in the EU, it is currently estimated that 90 per cent are housed in cages, with 10 per cent in alternative systems of production. In fact, over 70 per cent of the barn and over 50 per cent of the free range laying hens in the EU are housed within the UK.

  The costs of implementing Council Directive 99/74/EC are enormous. At the present time 80 per cent of laying hens in the UK (25 million birds) are housed in conventional cage systems, which will be banned by 1 January 2012. In the UK the capital cost alone of moving to either enriched cages or alternative systems (barn and free range, etc) will be £452.5 millions.

  Besides the capital costs of this welfare legislation, the cost of production will also increase. By way of example, the USA and other third countries typically stock birds in cages at 350 cm2/bird, whereas in the EU the current requirement is to stock at 450 cm2/bird. This results in our production costs being 7 per cent higher. By 1 January 2003, the stocking density in the EU will decrease to 550 cm2/bird, which will disadvantage our industry even further, with costs then being some 14 per cent higher than third countries. This assumes that we can purchase cereals at the same price as third countries, which is not the case. In fact, feed costs in third countries are some 40 per cent lower than in the EU.

  Our industry will be unable to compete. In the Commission's communication on the protection of laying hens—COM (1998) 135 Final (March 1998)— they said that if the EU import duty was further reduced by 33 per cent in the years up to 2010 then the EU industry would no longer be competitive if their costs increased by 10 per cent. In fact the minimum cost increase will be between the conventional cage at 450 cm2 and the enriched cage where running costs will increase 24 per cent.

  You indicated in your letter that you do not believe it is realistic to expect any significant progress on animal welfare issues in the WTO for the time being. This is confirmation of what our industry has been fearing, such concerns having been raised with MAFF and the European Commission.

  What can we do about this? As Trade Minister, it is vital that you appreciate the real economic implications for the UK industry of this issue. We would like to come and discuss our concerns with you. In particular, we are seeking your help to ensure that our market is not undermined by cheap imported eggs. Whilst additional help should be provided in the form of an expansion of the WTO criteria so as to provide that eggs and egg products can only be traded between countries with the same welfare standards, if this should prove to be non negotiable, then there should be no further reductions in import tariffs, or increased market access for third country eggs or egg products. Indeed, additional levies should be imposed on imports from third countries which do not have the same strict welfare rules as the EU.

  By way of background, the British Egg Industry Council (BEIC) is an inter-professional organisation of 11 trade associations in the UK, which cover all aspects of the egg industry—breeding, hatching, rearing, laying, packing, egg processing and marketing. Besides its role in lobbying on issues of concern, it also finances publicity and advertising campaigns and research and development. It is recognised by Government and Parliament as the substantive voice of the egg industry. BEIC is funded by a voluntary levy on a number of packers and producer/packers who between them represent some 74 per cent of UK egg production.

  I am copying this letter to Nick Brown.

  I look forward to hearing from you.

10 March 2000


 
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