AGRIBUSINESS UPDATE

November 2018

MARKET NEWS AND CURRENT EVENTS

On November 7, 2018, California voters approved Proposition 12, which requires that eggs being sold in California come from cage-free hens by the beginning of 2022. Dubbed the Prevention of Cruelty to Farm Animals Act, Proposition 12 is sponsored and financed by the Humane Society of the United States, which also backed Proposition 2. In contrast to the earlier initiative, this measure specifies how much barn floor space a hen should get and the types of cage-free layouts that are acceptable. The measure also requires that hens have nest boxes and perches for flying to and from. This legislation is estimated to cost $10 million a year to enforce.

In anticipation of changes in the industry as a result of Proposition 12, Cal-Maine Foods Inc., said in June it had increased its cage-free capacity. The cage-free hen population has exploded to a 60 million-dollar industry in the U.S., which is nearly double what it was in 2016.

Resource Links

http://ir.sandersonfarms.com/news-releases/news-release-details/sanderson-farms-inc-provides-update-hurricane-florence-damage

https://www.businesswire.com/news/home/20180920005818/en/Sanderson-Farms-Names-Edith-Kelly-Green-Board-Directors

https://sandersonfarms.com/press-releases/sanderson-farms-donates-1-million-american-red-cross-hurricane-recovery-efforts/

https://www.businesswire.com/news/home/20181001005113/en/Cal-Maine-Foods-Reports-Quarter-Fiscal-2019-Results

http://calmainefoods.com/investors/press-releases/    

http://www.latimes.com/opinion/editorials/la-ed-proposition12-20180928-story.html#

http://www.thepoultrysite.com/poultrynews/40600/california-votes-hens-must-be-cagefree-by-2022/

https://www.bloomberg.com/news/articles/2018-11-17/cage-free-eggs-are-out-pastured-ones-in-as-tastes-change-again

The cage-free hen population has exploded to a 60 million-dollar industry in the U.S., which is nearly double what it was in 2016.