Retailers warn of a egg shortage, hike in prices

Gilmour's, the country's largest supplier of wholesale food and beverages, is warning that the price of eggs is set to increase and the breakfast favourite may be harder to come by as egg farmers move to meet changes to the law.

In an email sent to customers today, the retailer owned by supermarket giant Foodstuffs, said "huge investment" was required by the industry to meet the Animal Welfare Code of Practice for Layer Hens which in turn would drive up the price of eggs.

"There is currently uncertainty around supply as farms struggle to gain resource consent for new production whilst other suppliers exit the supermarket sector and/or industry altogether. This is resulting in a shortage of eggs which is expected to continue over the short to medium term as the industry readjusts," the notice outlined.

Gilmours said due to higher production-related costs colony eggs would be sold at a premium as cage eggs are phased out.

Colony eggs refer to large pens that can house up to 60 hens and allow the birds to perch, use scratching pads and have separate nesting areas.

Changes to the Animal Welfare Code of Practice were first announced in December 2012, the move means farmers would be required to transition their hens cooped up in cages to large colony enclosures with few animals and space to move around by 2022.

Egg Producers Federation (EPF) says about 40 per cent of the country's conventional hen cages which house close to all of New Zealand's commercial egg supply were required to be upgraded to colony cages at the end of last year due to the age of the cages.

Analysis from the EPF found it would costs egg farmers between $660,000 and $8.5 million to meet mandatory changes to the enclosures.

Foodstuffs, which also operates New World and Pak 'N Save stores, will stop stocking caged eggs, including colony eggs by 2027.

Countdown stores in the North Island will not stock cage eggs from 2024 and South Island stores intend to do the same by 2025.

Nikhil Sawant, head of perishables, deli and bakery at Countdown, said the supermarket which is owned by Woolworths NZ had noticed an increased demand in barn and free-range eggs which had put some pressure on suppliers.

"New Zealanders are increasingly interested in social and environmental issues and this is influencing what they buy. In the last few months we've seen an increased demand for barn and free-range eggs which has put some pressure on supply industry wide," Sawant said in a statement.

"We're working closely with our egg farmers as we all adjust to this increased demand, but there are unfortunately going to be shortages from time to time. We're trying our best to keep shortages to a minimum and are expecting supply to improve in the coming few months."

Foodstuffs spokeswoman Antoinette Laird said there was no egg shortage.

"There are plenty of eggs on the shelves of our Gilmours stores and supermarkets. We simply informed our wholesale customers that caged eggs are being phased out in accordance with the new legislation as a way of helping people adjust to the change," Laird said.

"There are plenty of other egg options available to our wholesale customers including colony, barn and cage free."