Sales soar, dip and stabilize —then prepare to do it all over again.
A year ago, egg sales soared while quarantined would-be chefs and bakers experimented in their kitchens. And although sales dipped when restaurant and bakeries reopened, experts agree that not only have sales stabilized, they’re expected to take off once again as home cooks prepare to share their newfound culinary skills at holiday parties.
During the 12 weeks ended Sept. 5, total fresh egg dollar sales dipped 1.2% (versus the same period a year ago) to $1.39 billion, according to Chicago-based market research firm IRI (iriworld
wide.com). However, double-digit gainers Vital Farms, Nellie’s and The Happy Egg bucked the trend, highlighting a continued shift to specialty eggs. In fact, the split between commodity and specialty eggs moved from78.6%/21.4% in 2017 to 73.9%/26.1% in 2021. Sales of pasture-raised (+19%) and free range (+12%) eggs are growing the fastest off of small bases. But organic and cage-free also continue to gain ground, the latter thanks in no small part to cage-free mandates set to go into effect in January in several states. As a result, reports John Brunquell, co-founder and president of Warsaw, Ind.-based Egg Innovations (egginnovations.com), the number of cage-free hens now exceeds 92 million, representing 28.9% of the supply chain.
The big question, says John Watson, vp of sales and marketing stewardship at Nashville, N.C.-based Braswell Family Farms (braswellfamilyfarms.com), is whether specialty eggs will continue to outperform commodity eggs when prices go up. “With the cost of grain, organic soybeans, fuel and everything else going up, specialty eggs will have to take a bit of a price increase,” he says. “It can’t be avoided. So we’ll see how consumers react in the next month or two.”
STRONG HOLIDAY SEASON EXPECTED
Still, “Barring any pandemic setbacks, we’re expecting a strong holiday season — the peak sales season for eggs — as more families are able to gather and people return to entertaining at the holidays this year,” says Marc Dresner, director of integrated marketing at the American Egg Board (aeb.org), Chicago. “2020 was an extreme outlier year, but we’re seeing a return to pre-pandemic volumes,” with current sales already tracking close to 2019 levels, he reports.
To help meet expected demand and also allow consumers still leery of COVID to limit shopping trips, manufacturers continue to boost package counts. “Larger sizes have definitely taken over,” says Watson, citing strong sales by Braswell’s 18-, 24- and 36-count packages across all offers. Even specialty egg manufacturers are answering the call. For example, La Farge, Wis.-based Organic Valley (organicvalley.coop) recently released an 18-count SKU that “continues to build strong momentum” says vp of brand management and innovation Meenakshi Trehan. “Meal occasions at home are increasingly relevant and COVID further increased ingredient-based/from-scratch cooking,” he explains. “[So] consumers are trading to larger sizes and sales.”
‘People want to understand the dynamics of the farm, where it’s located, what else they raise, etc.
So we’re doing a lot of farmer features that help consumers get to know them better.’
Another key category trend is growing consumer interest in the farmers that supply the eggs they buy. “People want to understand the dynamics of the farm, where it’s located, what else they raise, etc.,” says Watson. “So we’re doing a lot of farmer features that help consumers get to know them better.” Shoppers also prefer to buy local whenever possible, prompting Braswell to relaunch its Natural Choice brand. Since most of its farmers are located in North Carolina and Virginia, the company is positioning the brand as local for shoppers in those two states, says Watson. The Natural Choice lineup includes free-range, pasture-raised, organic and all-natural SKUs and is available up and down the East Coast.
REGENERATIVE AG GAINS MOMENTUM
While the move to cage-free eggs of all types addresses consumer demand for more humane treatment of animals, a handful of manufacturers have turned their attention to improved treatment of Mother Earth as well. Leading the charge, Monroe, N.H.-based Pete & Gerry’s (peteandgerrys.com) recently launched the Consider Pastures brand, which is produced using holistic farming practices designed to help protect the environment. “We believe that regenerative agriculture is one of the most important trends in food production currently with consumers beginning to broaden their focus from animal welfare to farming practices aimed at reversing climate change,” says vp of marketing Paul Turbeville. Key strategies include rotational grazing with secondary livestock (such as cattle), pollinator habitat improvements on each farm to benefit native pollinator species, beekeeping on each farm to support healthy bee populations, cover crops to hold soil in place, and routine soil testing to monitor and quantify critical measures such as carbon sequestration, he explains.
Not only did the company abandon the factory-farming model in favor of pasture-raised eggs from traditional family farms, “Consider Pastures uses a distinctive egg carton to bring consumers along on our regenerative journey,” says Turbeville. Made from 30% post-consumer Forest Stewardship Council Certified materials and printed with soy-based inks, the cartons feature individual compartments to cradle each egg, minimizing breakage. And when stacked on the shelf, the cartons form a cohesive pattern, reminiscent of wallpaper, with gold foil bold lettering, he adds.
New Barn Organics (newbarnorganics.com), owned by Denver-based NestFresh, takes regenerative agriculture one step further, launching two SKUs of Regenerative Organic Certified (ROC) pasture-raised shell eggs (both “regular” speckled brown and multi-color, the latter of which is produced by a variety of heritage-breed hens).
In addition to Earth-friendly agricultural practices, “Regenerative organic certification goes beyond organic standards and requires the highest level of animal welfare practices. It also ensures a living wage for farmers,” says New Barn Organics founder Ted Robb. “We’re getting a lot of interest from retailers as we bring these new SKUs to market, and we believe it’s because they’re looking at the same consumer trends we are.”
Egg Innovations is also balancing dual demands for animal welfare and regenerative agriculture with its new Blue Sky Family Farms Helpful Hens lineup. The sustainably farmed free-range and pasture-raised collection includes Pasture-Raised Organic, Free-Range Organic, Pasture-Raised Non-GMO and Free-Range Non-GMO varieties, the latter two of which offer many of the benefits of organic but at a lower price point.
“We believe this is the perfect mix of our animal welfare and sustainability missions,” says Brunquell, who credits millennials with driving the change. “It is good for the farmers and the hens…. [And] for the retailers, there is perfect alignment with today’s consumers, and there are solid margins for retail.”
DUCK, DUCK … PROFITS!
Lancaster, Pa.-based Utopihen Farms (utopihenfarms.com), which was founded by George Weaver in 1963 as Nature’s Yoke (naturesyoke.com), has also found success in the premium egg category. But the third and fourth generations, president and CEO George Weaver III and his son George Weaver IV, are hoping an expanded product line will sustain the family business for many years to come.
The “new” Utopihen Farms brand hit shelves earlier this year with a shift in focus from free-range to 100% Certified Humane Pasture Raised Eggs. This standard of excellence is met with a mission focused on responsibility, sustainable living, and creating a better world. George Weaver IV says his vision for the future is to “meet the consumers where they are.”
“Utopihen is more than just an egg brand, it’s a movement,” says Weaver, who adds that the company has re-examined its product line to address customer needs. Customers are looking for products that won’t trigger chicken egg and soy allergies. In response, the company added both non-GMO duck and soy-free eggs. Consumers, he says, benefit from GMO-free and soy-free eggs that contain extra omega-3 fatty acids. And retailers, he says, stand to gain from storewide profits.
“The individual SKUs won’t move as fast as conventional eggs, but retailers will have a higher basket value storewide,” he says. “How do we relay that to buyers? The consumers want it, and they will find it somewhere. Can you be the one to carry it?”