Investigation into free range eggs sale

Caged eggs from a Foxton supplier have been promoted as free range by another company in a deception uncovered by media. WGP 15Mar17 - CAGED eggs from a Foxton supplier have been promoted as free

A company has allegedly been supplying supermarkets around the country with caged eggs that appear to have originated from a production facility in Foxton, re-packaged as their own free range brand.

The Newsroom website reported that millions of caged eggs were sold by Palace Poultry as free range, alleging surveillance videos show images of a Palace Poultry company director picking up thousands of eggs packaged in distinctive plastic-wrapped pink cartons on blue pallets from Eco Foods, an egg wholesale supplier in Bombay, Auckland.

The packaging appears to be identical to that used for size 7 eggs by Hessell's, a large caged-egg farm in Foxton.

Hessell's packs its size 5 eggs on green trays, size 6 on blue trays and size 7 on pink, in a colour coding system used throughout the caged egg industry. Free range eggs, which are usually mixed-grade, are not sold packaged like this.

Zane Dykstra, a manager at Hessell's, said he had seen the footage and that the eggs shown were theirs, and therefore cage eggs.

"I know for a fact that those pictures and video were our eggs [sic]," he said.

Dykstra said he was concerned about Hessell's having their name linked with a negative story, and had at no time known about or been involved in the alleged deception.

The eggs were allegedly used to supplement the free range eggs Palace Poultry produced on their own farm, and were supplied to Countdown supermarkets, and to two other free-range egg brands, Woodlands and Farmer Brown, both owned by Mainland Poultry's Zeagold division.

Mainland Poultry managing director Michael Guthrie said Zeagold had bought eggs from Palace Poultry, which is the subject of a Serious Fraud Office investigation, an inquiry it had known about since early February.

As soon as the company learned of the investigation, it pulled all potentially affected product and pulped it to sell as caged egg product, taking a "financial hit" to do so, Guthrie said.

"Since that time there has never been a Palace egg near any of our stuff," he said.
He said he had only found out this week about the scale of the alleged deception on the part of Palace Poultry, which apparently involved fake identities, in a scam that appeared to have been operating for some time.

Guthrie said that while the potentially affected product would now be long gone, as it was removed around six weeks ago, the fallout from the situation was still "devastating" for him personally and everyone who works for him.

"I've never seen anything like this before, nothing on a scale like this," he said.
Guthrie said Mainland Poultry wanted to see egg stamping at source, not at packaging plants, to eliminate the potential for deception.

"We need to work as an industry," he said.

Countdown had also removed Palace Poultry eggs from their shelves after the media investigation uncovered the apparent deception, although they were confident Mainland Poultry product was now unaffected.

"Mainland Poultry have today informed us that they stopped purchasing any eggs from Palace Poultry in early February 2017," Countdown said in a media release.

"We have sought and received assurances from Mainland Farms that all their free range eggs are from verified sources. Therefore, we do not believe it is necessary to withdraw Mainland Farm eggs from sale."

The chain said it was now in the process of engaging an independent third party to review the traceability controls in place on all suppliers of free range and barn egg farms to its supermarkets.

Egg Producers Federation executive director Michael Brooks said the industry had no tolerance for "ratbags" and that the Federation was indeed looking into egg stamping on farms to distinguish between caged and free-range eggs.

"This seems very much to be a one-off, but we will continue looking at this further step of egg stamping to give confidence to consumers, but also to try and preserve the integrity of the industry because people are really furious about what's happened here," he said.

Palace Poultry were audited under the Ministry of Primary Industry's Registered Risk Management Programme.

When contacted, Ministry for Primary Industries (MPI) said it was not investigating the situation "because there is no evidence to suggest that there are any breaches under the legislation MPI is responsible for regulating".

The SPCA Blue Tick is the only 100 per cent independent accreditation focused on high animal welfare in New Zealand.

All SPCA Blue Tick labelled eggs come from farms approved by the SPCA to adhere to strict, high-welfare standards, with the tick only given to layer hen farms.

The organisation does not approve of or certify battery or colony cage systems.