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State, Congress in a cage fight over eggs [The Orange County Register](Orange County Register (CA) Via Acquire Media NewsEdge) Nov. 21--WASHINGTON -- Call it a cage fight. Members of Congress are fiercely debating whether California can, in effect, regulate the business practices of other states, in this case, the size of the cages that hens live in, if those hens are laying eggs that will eventually be sold in California. Depending on which way the argument is settled, California consumers could face either a period of lower egg supply and higher prices, or an abundance of eggs at cheap prices, industry trade groups say. The California egg industry, too, is watching closely because its future is on the line. The imbroglio is all part of the farm bill -- better known for food stamps and farm subsidies -- now being discussed in a House-Senate conference committee reconciling Senate and House versions of the bill. The egg flap dates to 2008, when California voters approved Proposition 2, which required California hens be housed in cages that are big enough for them to spread their wings without touching each other. In 2010, the state legislature applied this standard to all eggs sold in California, no matter where the producer is located. The new regulations are scheduled to go into effect in 2015 -- but not if Rep. Steve King, R-Iowa, has his way. King, who represents the leading egg-producing state in the nation, added an amendment to the House farm bill that would prohibit states from requiring other states to follow their regulations. King argues that Iowa egg producers, who supply one-third of California's imported eggs, shouldn't need to follow California law to sell their products in the state. The proposal is written broadly enough that it could potentially affect many agricultural products, not just eggs. Where it stands California members of the conference committee, including Reps. Ed Royce, R-Fullerton, and Jeff Denham, R-Modesto, are working to ensure the language doesn't make it into the final bill. King's amendment is in the House bill; the Senate bill does not have the provision. King, though, is on the conference committee and arguing forcefully that "no state should be allowed to regulate production in other states." Aides describe the ongoing discussions as heated. The committee aims to work out a compromise by year's end, on not just this issue but food stamps and agricultural subsidies as well. If their work isn't completed, dairy prices could skyrocket in the New Year. If it passes: Damaged producers, cheap eggs King's amendment "will have a devastating effect on egg farmers in California," said Arnie Riebli, co-owner of Sunrise Farms in Petaluma. Riebli's farm has 1 million hens and produces 5 million to 6 million eggs a week. Out-of-state producers would be able to "sell eggs for a cheaper price than we can. We have to offer the double-the-space for our chickens," Gary West of JS West and Companies, an egg farm in Modesto, told the Register. West said it costs about $15 per hen to upgrade to the newer, spacious cages. He has about 1.8 million chickens on two farms; so, the expense has been "considerable." The cheap, out-of-state eggs will have a market advantage, Rayne Pegg of the California Farm Bureau said. California egg farmers, she said, will be asking, "Can I stay in this business?" If it fails: Counting your chickens California relies on egg imports from other states, and West said that without imports, California would be short about half its egg consumption. "We're going to need more eggs. We can't produce enough," he said. Maro Ibarburu,an agricultural economist at Iowa State University's Egg Industry Center, said no one knows yet what exactly will happen to California's egg market once the Proposition 2 regulations go into effect, but that he wouldn't be surprised if California faces a one- to two-year period of reduced supplies, and a subsequent price hike. "I don't think that the industry is going to be able to convert that fast," he said, "I'm almost sure that in the first year or so we're going to see less eggs going into California." Nationally, the average price for a dozen eggs is $1.90, according to the Bureau of Labor Statistics. California's prices have historically trended a bit higher. At Vons in Santa Ana, for instance, a dozen large white eggs are $2.99 this week. The national egg industry argues the threat of reduced supply is one reason California should accept King's amendment. "We're looking for (the price of eggs) to be increased 55 percent if the King amendment fails," Ken Klippen, a consultant for Egg Farmers of America, said. "It's going to hurt." Ibarburu said it's too soon to know how consumers will respond to higher prices. "This is a question that nobody knows the answer to," he said, "We know the market is very inelastic for eggs." What's next Senate Agriculture Chairwoman Debbie Stabenow, D-Mich., told a CQ Roll Call reporter Tuesday that she was unsure whether a farm bill framework would be released this week. "I'd love to have an agreement with the four principals by the end of the week or very soon after. It's a big Rubik's cube and we're putting the pieces together," she said. Supporters of Rep. Steve King's, R-Iowa, amendment to the farm bill say Congress has the right to regulate interstate commerce, but opponents say it interferes with state's rights. King's amendment would prohibit states from putting restrictions on out-of-state agricultural products sold in their states. Critics say the law is written so broadly it would affect roughly 150 state laws nationwide, including regulations on raw milk and unpasteurized cider. The Secretary of Agriculture Tom Vilsack said Monday, "It's an amendment that's frankly a bit troublesome in that it would create legal challenges and confusion in the marketplace." "We see this as a violation of states' rights," Ben Husch of the National Conference of State Legislatures, said. "If a state feels for the safety of its constituents ... that it needs to pass a law to protect those different economies, those elected officials should be safe to do so as long as it doesn't violate any existing federal law." Proponents, though, say the Constitution clearly delegates to Congress the power to regulate to interstate commerce. Contact the writer: [email protected] ___ (c)2013 The Orange County Register (Santa Ana, Calif.) Visit The Orange County Register (Santa Ana, Calif.) at www.ocregister.com Distributed by MCT Information Services |