Europe faces Easter egg quandary

[March 30, 2012]  BRUSSELS (AP) -- 'Tis the season to paint Easter eggs in Europe. Now children, listen: Handle with care, they break easily -- and this year there are not too many about so they are very expensive.

Demand for eggs traditionally reaches its peak around the Easter holiday. This year, the egg industry has been hit by the European Union's new requirements for bigger, more animal-friendly cages for hens. The changes it brings have affected production and, combined with high feed cost, boosted consumer prices.

Ahead of Easter Sunday, on April 8 or 15 depending on the religious denomination, it makes for a costly tradition on a continent where millions have grown up painting or dyeing eggs as children and are now facing economic crisis.

At Warsaw's Hala Mirowska market, the egg sales of Jacek Bechcicki are down as he faces customers grumbling about high prices. "The holiday will be poorer for some of my customers," Bechcicki said.

Pekka Pesonen used to color and dye eggs as a kid in his native Finland. As a rite of spring, "it was a celebration of new life," he remembers. Now, Pesonen is secretary general of a major European farm federation and is seeing how the new EU legislation has put a damper on this Easter season.

"Obviously it has had an impact," he said.

The European Egg Processors Association says that EU-wide production of eggs since the Jan. 1 legislative change has dropped by 10 to 15 percent, or about 200 million eggs a week.

Prices have sometimes tripled on international markets over the past month, peaking at over 2 euros ($2.60) per kilogram, said Philip Van Bosstraeten of Ovobel, an international company which makes equipment for egg processing.

Van Bosstraeten was speaking from Venice, Italy, where he was attending a conference of the International Egg Commission and said the place was abuzz with talk of the egg crisis. "All you hear is deals being sealed for imports from outside of Europe," he said in a telephone interview.

There is concern of a doubling in price in some EU nations and supermarkets. The European Commission said that overall the price for table eggs in early March was 55 percent higher compared to the previous year and officials said the increase has somewhat tapered off in past days.

Price differences across the EU are big though.

While half a dozen premium eggs at a Warsaw market cost some 6.60 zlotys (euro1.6, $2.12), they stood at euro2.71 in a Brussels supermarket. The Polish poultry chamber said that in the second week of March, prices were 63 percent higher than in the last week of January and over double the price that the year before.

Eggs -- whether scrambled, fried or painted -- are such a central part of European life that higher prices have become a political issue at a time when many families have to limit spending.

Even presidents get involved.

Czech President Vaclav Klaus has long presented himself as a staunch defender of national sovereignty in the face of what he calls EU meddling from Brussels.

Now, he says that Brussels has egg on its face with a sinister plot of market manipulation.

"We all know should know that such massive changes in prices don't take place in a normal market economy -- they take place only where the market is manipulated," Klaus said this month.

"The main reason for the jump in eggs prices was again a state intervention," Klaus said. "But of which one? We don't have just a state called the Czech Republic in place, but also another one, which is more dominant in many matters, and is called the European Union."

The EU acknowledges that there has been a clear reduction in eggs because of the cage ban but blames the industry for not taking action earlier. The EU gave producers a dozen years to adapt their equipment to the animal-friendly rules -- but many still haven't complied.

Because of the legislation, some farmers have shut down rather than face the cost of transformation. Some are busy renovating their installations, and others can continue using their old systems until August but can only sell eggs in liquid form.

And everybody knows liquid eggs make lousy decorations.

On the other hand, those who did prepare have reaped high profits as prices soar. And even Pesonen of the farm association sees the possibility of the new EU rules leading to an Easter rebirth.

"We hope that these higher prices have given farmers incentive to produce more," said Pesonen.

[Associated Press; By RAF CASERT]

Karel Janicek in Prague and Vanessa Gera in Warsaw contributed to this story

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