[Music] first of all good good afternoon everyone I'm very pleased and now to be invited to speak that this egg conference I think I will need a timekeeper so Peoria or Delphine if you could add me on this thank you well this this this this discussion is about the European egg industry it's it's situation and recent developments so first of all I will I will address some some backgrounds on the regular regulatory measures and social social concerns that shaped continue to shape and say thank you and continue and will continue to shape the EU egg industry in the second part another view of the European egg market its structure and recent dynamics and then a quick overview of the global egg market US trade with non EU country became an increasingly a part of the EU market balance so social social concerns to agricultural and most specifically animal breeding in Europe change over time first in the it was all about environmental issues in this in the 70s and 80s then more about health concern like BSE dioxin etc etc farm size more recently the use of anti anti biotic in the in the animal breeding sector and more recently and a growing concern about animal welfare each topic never quite fighting but growing or declining but just adding up one after another so concern of concerns about animal welfare in in the 90s roughly in the night in the 90s in Europe first in northern Europe and then spreading to to the whole European market this led to new regulation at the time and increasing power of NGOs with a strong support formed from the media and this it's an important topic that we'll discuss under under conclusion and the commitment not to use caged eggs anymore started in 2000 around 2000 2005 2010 in in in Northern Europe with Belgium the Netherlands and Germany and quite recently a friends was also it by to such movement in 2015 in fact this was more it's the second wave of of commitment to to go out cage cage eggs which started in the u.s. in 2015 and spread and spread to the u.s. to the to the to Latin America especially where all major egg buyers made commitment to stop buying caged eggs it would be it was some retailers and processors some food service companies made some some such statements so some some so about EU regulation about the way of Leo of keeping as a reminder it's all started at the at the end of the 80s with three milestone 1999 with the council directive banning progressively banning a conventional cage also small cage to Indy Indy EU 2000 2002 with the mandatory labeling of the way of keeping ends which is a unique framework in the world the regulation of such labelling it's unique in the animal sector in Europe and also around around around the world and 2012 is the full implementation of the e-reader active with some grammatical change in the in the EU markets as we will see later so not every member state choose in 2010 in during this period between 1999 and 2012 not every members to choose the same option with some country be banning conventional cages earlier than 2012 it way it was like Austria Germany and the Netherlands with and in the Netherlands with a strong League with the German market as we will see later on so but animal welfare Council are not just about housing housing housing ads there is also some important topic like as debeaking and big screaming which will be addressed by a presentation tomorrow and another issue was quite recently is the elimination of male chicks with a green concern above about discarding of after a population of of chick during the production process with ongoing research programs in Germany the Netherlands and France about in oval sexing so determining the sex of the chick before its attaches and this if such technology emerged it will be a a game changer for the actuary business if you imagine to just increase the capacity of actuaries by 50 to 30 to 50% it would be some market concentration and and and a few fewer and fewer players in the business and and bigger and bigger tools so this said about you egg and egg product markets unlike some other sector like mid sector figure about egg sector may be quite unreliable and and all difficult to to access because days there is no no consistent way to count the eggs produced see in Europe some countries use more use models others you use a throw to to packing centre so it's more an art than science to to to make it an analysis after you egg market but anyway if you look at the production figures in fact seven member states may produce more than 75% of the EU egg 75% of the EU egg production being France French spends Germany the Netherlands Poland and and in the UK so if you look at the the evolution the green bars are the total EU production and each line is represent a country if you look at the evolution of production back by country you can clearly see the in the impact on the change in housing systems first in Germany the decrease linked to the to the shift from cage to to mostly to to enrich cage or bomb and in France later on and in two thousand two thousand two thousand twelve but what and glow on the EU level what you can see is after 2012 there is an increasing level an increasing level of production in increasing increasing production in in Europe why where the way at such difference after before and after 2012 where such higher level of production first because the remaining remaining players remaining farmers increased production capacity at the farm level of setting the loss of farmers exciting exiting the the market and secondly the the the the second explanation being that with new building new housing systems you have cleaner cleaner farms and so improved technical performances in such in such news so the the il level of production but the change in in in Northern Europe this slide shows the the dramatically change is to share of of ends kept in engaging across several EU country from 2007 to 2015 change has been quite dramatic in in Northern Europe like Austria Germany in the Netherlands with a shift from cage cage x2 to to bound eggs that we at the moment have been no such no such change in in Spain or Poland but it's it's currently changing in Spain and Italy the two step two step change first in around first just in in 2012 and then after with a shift also from from from banner to from cage to to bound to bound why almost most of the country shifted from cage to bond formed for manual pinion for two reason because of with bond you kept the basic principle of controlled environment will by keeping the ends indoor on the contrary that you can't have with the free-range systems and - there is no supplementary land needed for raising poultry so you know that which to change the the land bank of the farm and you you you can easily shift from one system from cage - to abandon - - to free-range but some some countries choose a different system alternative so-called alternative system for instance France Belgium and the UK are more about it's more about free-range the development was more about free ranged and unbound and it may be Spain in the future will be more about also ball about free-range done and unborn which this shifts from from cage to - to alternative system which being bound or especially free-range organic as a an impact on the on the feet sector because usually even if it's improving hens kept outdoors or in alternative system it's more feed than the one kept in for the same level of production create more feet than those getting in in cage so another another another pattern is the it's a map that showing the the the level of self-sufficiency in egg the ratio between production and consumption across Europe and there is almost 1/3 typist country the net largely net clearly net exporters in the green the slightly there are more oriented to what export but it's not so clear for instance France and Italy usually change from one year to another from being importers to two net exporters and the net importers the the the big the big importers being mainly sexual public and in Germany and also and also Switzerland in fact in fact there is close tie between between the Netherlands and Germany and also close ties between Poland and the Czech Republic the the deficit of Germany being the excess of egg production in the Netherlands and the deficit in Czech Republic bidding part of the excess of egg production in in in in Poland so and finally there is also a variety of patterns for egg consumption across Europe first of all the quantity of egg per capita consumed in each country those figures are estimates the orange yellow bar being the shell eggs consumption green 1 egg product and pink red a boss being no information about the split between egg product and jelly so in term of quantity per capita consume per year it goes from 1 to 3 between for instance Eastern European countries and and in northern and western European countries like Spain or Denmark and also in terms of the share of egg products in the total consumption from the iron share being in France and Italy around 3540 person where the EU average egg product and share of egg product within total egg consumption in around 20% percent the share of egg product depends in the the shape of the the food industry in the country but also of the dependent on the recipes and countries be having a significant bakery or pasta sector are using a using I share of egg products it's mainly egg products are mainly eaten eggs in in recipe while if you look at the u.s. with 30 percent market share days its so it's a higher share than the EU average but you have also of course the the so-called hidden eggs in recipes in in food products but you are also some products on available on retail about liquid eggs or liquid eggs for own consumption which is not as widespread in Europe and the in the in the US and like Pierre Andre showed the the the share of egg product within egg consumption in other countries for example Mexico urgent you know China is very very limited it's mainly about shell eggs sorry a few words about European egg companies having European egg companies having production facilities in beyond the country of origin is a quite recent phenomenon mainly in in-between in the Netherlands each major you Dutch player having operates in on the German market you can consider the Netherland and Germany as a single market in fact and what's changed also is the market concentration to share that one company the market leader having in in one country with some quite advanced market concentration or in the in the UK in in Italy but also in in Scandinavia with only two company maybe making the bulk of the production but also the the the important topic is on the is the diversity of the the business models in the X sector either from cooperative or privately owned company from the best of my knowledge there is no a company on stock exchange in Europe and also the the relationship between the each part of the egg value chain some company being in credit integrators from feed two egg products and some companies being specialists even one one one sector like just pure egg Packers are in contract with with farmers or pure egg product producers specialize the either in dry egg product or liquid egg product just for the egg product for the retailer to the industries so in fact this wide the difference in business models are greater within a country than between Europe between a European Wien country so it's quite difficult to make a general overview of the of the egg business but what we can see that the trend is that there is some regional regional market concentration in your emerging the regional European market obviously in northern Europe between Belgium the Netherlands and Germany one more recent emerging original market in Europe is Scandinavia with Denmark Sweden the Baltics Baltic countries and and in Finland and an arguably the regional market between Portugal Portugal and Spain but decide this clear regional markets days so sorry the fact that a country have the company of production facilities in another country explains a lot of the EU trade this graph shows the huge you egg and egg product thread within European country and the fact is that more over 20% of the EU production is traded within the US which is quite a significant amount of of of the Shred in food for the food product I from what I remember is it's way less for the poultry poultry poultry meat there has been a strong development of you again product trade within your the EU up to 2012 and then a slowdown mainly such a slowdown mainly due to the Dutch German trader which accounted for 35 percent of intra you trade in 2012 and now just I can for 25 percent the fact that this Germany is becoming more more and more less dependent on imports if even from from the from the Netherland if you look at the products traded it's mostly shell like sixty percent is basic production eggs either for retailer for breaking and from from especially from neighboring country for example Poland exporting to Czech Republic neither on to Germany and Spain mainly to to friends for many eggs for for for breaking so quite significant change traded in Europe and if you look at this map map shows the Qureshi correlation between tabular egg price across country when there is a country at the same color its Korea correlated over seventy percent quite a strong correlation and countries the countries displayed in green account for 70% of you production it's mean that there is a market shock in one country quickly spread to two to another to another you you country in the index sector and since 2012 prices have been quite volatile here's the egg prices in Europe in 2012 the the shopping quiz is related to the conventional cash ban and the lack of prediction because production facilities were empty at the time producers waiting up to the 31 of 31 of December to to implement the the the regulation and in 2013 an oversupply because of the increased level of production while every every producer expecting its enable to go out of business and not anticipating the fact that they will be another one we build twice we build twice the size of its previous production capacity in Europe so and quite and and then in 2000 in 2000 in 2000 in 2013 it was quite quiet and then in 2015 the surge in price was due to the avian influenza in in in the US especially in the Midwest which led one first of all with some withdrawal of the u.s. from the global markets so less egg product evaluate DG for us less US egg product availability into Europe into Asia and some export opportunities for the European country especially Spain for the shell eggs for for braking and the Netherlands and then in 2016 the tremendous surge in price is linked with the free prodding crisis in the Netherlands but also a small part with the avian influenza in in Italy which claimed a little less than 1 million laying ants so the markets installed 2012 in a quite quite volatile volatile do you mainly due to external shocks later lately so global perspective no new market has always been part of the you market balance okay but it's increasing with the increased European production it became an increasing part of such such internal European market balance with first of all the decreasing import levels starting from 2013 because of the egg oversupply in the EU and then for the change in the market to the egg market in in Europe being the demand for alternative so-called alternative egg for alternative egg products increase which only the at the time at the moment mostly the European can provide such type of eggs the other country being more into caged eggs while it's quietly quickly changing in the in the in the US and some exports opportunities mainly where first in 2015 it was the u.s. okay but only the middle eastern region Africa when it's too much eggs on the market Africa is a good market and also egg product for for Asia but if you look at the global trade in the X Factor only you have to remind that only 2% if you exclude if you consider the European Union as a world country and you exclude trade within European countries only 2% of the global production egg production is traded around the world and that 70 65 to 70% of the volumes are basic products and very very very specific trade flows for example the Turkish exporting to Iraq Belarus exporting to Russia and us can add a Mexican shred and if you withdraw all these specific trade days almost no shell eggs no less shall trade around the world and the second the third the pattern is that since 2012 its to 2010 there is no growth in in volume in the global egg in the global egg trade it's a stabilization and in fact if you look at some major importing country like Canada like Japan ok Switzerland you can see that there has been at least a stability and stabilization of the country dependence to imports and even an improvement of the self-sufficiency ratio in those in those countries so they are increasing slightly sometimes their local production to address their their local market the second part about global market is that ok if one driver for the global trade trade is the quantitative the egg deficit connotative egg deficit the other one is the imbalance between the use in the York or white use to region bin users of York because the just because of the food recipe like bakery pasta being Europe and Latin America anglo-saxon country being more inclined to other white and too big region being more about white in Eastern Europe ex-ussr countries and and in Asia but the demand in white is not the same white for example in Russia for what I understand is not about forming properties that the market is about more forming properties and in Asia it's more about the gluing properties of the egg egg egg weight and in this table market there is also a growing competition if you look the figure here is the the egg total egg production and the the percentage is the share of the the region of the country in the global global exports so two players - two main players being the European Union and the u.s. it was more balanced in after before 2015 region been more exporting almost the same global amount of again X products but due to the to the Indian in fansign 2015 Europe gained market share so to be exporting region and some challenge and if you look at Turkey turkey accounts for 23% of the global egg export but it's only shell eggs and for one destination Iraq the threat being for European market being that being that if if you look at Turkish egg production costs there are way up Europe and one momentum and mainly because of relatively poor technical performances and also I fit cast but so apparently it's they know said that they could export to to to Europe except there is a shock and why not in the Iraqis and Syrians market that's led to an oversupply situation in in Turkey and if you look at the other competitors they are quite limited market share like Argentina being used to be an important competitor but it's still on on specific markets but not specifically for a competitor of Europe more I see them more as a competitor from the from the US they have the same export the same product but the fact is that the Latin American market is strongly and quickly developing so there are the Latin American market their reduced presence and the Asian or Middle Eastern market because the original market them lemon increase India exporting mainly to the Middle East and x2 to Africa but the fact is that in my opinion the the Indian market the it has companies built to export egg but there is no a strong domestic stronger the is a strong domestic market a large base for domestic market in the India and Ukraine in Korean in fact faced the market leader in Ukraine faced several problems since 2014 and decrease in international presence and they are facing they're facing problem because of the economic downturn like the country failure is facing because each from what I understand each family each individual kept hands in this backyard and reducing the the market the internal market for any commercially produced eggs so increasing competition but European Union as a strong strong position if to try to to make it synthesis to conclude with a few points a few perspective its first of all is the continuing shift out of cage across Europe but also globally with at least the begin increasing feed volumes needed please but the fact is that the way the way with them with a shift out of sketch the the question is about free range and the threat of envy in Indian infringer across the rope and especially in in the world and especially in Europe second is the increasing competition from international suppliers but local production is is in some major countries is increasing so there is be a likely shift from a commodity market to a speciality market especially for egg products the impact of the brexit UK being being quite a market for the European player the unknown outcome of the of the brexit a further consolidation of the of the European business not too much to increase market power but to acquire specific know-how and technology from from competition and more moreover there is an increased and especially accelerated social pressure - what - shifting in in n in eggs outing the acceleration being the key word because it's not that the country is not too much about consumer demand with shifting less rapidly that the social social pressure which is increasing and ask for dramatic change in the in the on the on the production side but the good side the the the good good point is that egg market in Europe and all over the world recovering for the issues they have to with the l concern so globally we are eating more eggs every every every year thank you for your attention [Music] you