Farmers in northwest France have vowed to escalate an egg-smashing rampage they began this week in protest at low prices and rising production across the EU.Collective Insanity
The protesters say a 2012 European directive, which obliges egg producers to improve the wellbeing of hens by increasing the size of their cages, has forced them to invest millions of euros to cover the upgrade.
On Tuesday night masked members of the informal collective vented their frustration by dumping 100,000 eggs – about 5 per cent of their output – from the backs of vehicles in the small Brittany town of Ploumagoar.
A day later, they descended on Carhaix. On Thursday, it was the turn of Morlaix, where they left 100,000 smashed eggs outside the tax office. Residents were quick to complain about the smell.
The producers have called on the government to help co-ordinate a 5 per cent reduction in the country’s production, and to designate a special site where eggs can be destroyed.
On Friday, Sébastien Salliou, a local producer, said that prices had sunk so low that he was now selling 100 eggs at €4.50, even though his break-even price was €7. He also said that the European directive had forced him to spend about €2m on infrastructure adjustments for his business of 100,000 hens.
The farmers want the government to "do something" such as put a quota on eggs or create a "special site where eggs can be destroyed".
If that is not bureaucratic insanity, what is?
Rather than receive €4.50 for 100 eggs, the farmers would rather receive nothing. Actually, the farmers should be fined for cleanup costs so they should receive less than nothing for smashing their production in public places, creating a smelly mess in the process.
I have a simple solution.
If you do not like the price, don't produce the eggs. Selling eggs for €4.50 when it costs €7 to produce them is not smart business. Nor is it smart economics to force everyone to pay more for eggs for the benefit of a few egg producers to the detriment of everyone else.
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
