Dr. Kristi Scott - Cracking the egg market amid coronavirus
As businesses and schools began closing due to the spread of COVID-19, the market for liquid eggs dropped while the demand for shell eggs in grocery stores increased. Dr. Kristi Scott, veterinarian for ISE in Maryland, discusses this shift in the sales of various egg products and how it has affected the industry in North America.
This episode is part of a special AgFuture series on the impact of COVID-19 on the food supply chain. Join us to hear how those on the frontlines of the global pandemic are working to overcome adversity and feed the world.
The following is an edited transcript of Michelle Michael's interview with Dr. Kristi Scott. Click below to hear the full audio.
Michelle: Hello! I'm Michelle Michael. In this special series of AgFuture, we're talking with those working along the food supply chain about the impact of COVID-19. My guest today is Dr. Kristi Scott, a veterinarian for ISE in Maryland. ISE is an integrated egg-laying and production facility. Kristi, thank you so much for joining us.
Kristi: Thank you for having me.
Michelle: Can you tell us a little about your role in the industry?
Kristi: Yeah. I am the staff veterinarian for ISE America, and I'm in charge of the health and welfare for about six million birds located in South Carolina, Georgia, Maryland, Delaware and New Jersey. I also take care of the food-safety plants for six shell egg plants, as well as one liquid egg plant.
Michelle: Can you elaborate for me a little bit on what that means? Explain your role in food safety.
Kristi: Well, basically, I make sure that our plants are following the protocol that I've put in place for our safe quality food programs that we have for our customers to make sure that we have a good product that's going out, that's safe for consumers. We have different audits that we go through, not only from our customers but as well as third parties that come in and make sure that we are doing what we're supposed to be doing according to the Global Food Safety Standard that's out there for any kind of food product that is being produced, and I do that for all of our different plants.
Michelle: Boy, in the middle of a pandemic, I can only imagine how your role has changed with COVID-19. How is your day-to-day job changing? What's the current state of things where you're located?
Kristi: Well, I'm based out of South Carolina. At the beginning of this, we basically put a stop to all travel. Normally, I'd travel to all the different locations. I haven't been able to travel to the different locations and be there to help and see and do what needs to be done, so I've been working via email and text and phone calls and trying to help out where I can that way. The biggest difference has been that people turn to the veterinarian for more expertise in the science side of this and are asking questions that healthcare providers are trying to answer.
Michelle: What are some of those specific questions that they're coming to you with at this time?
Kristi: Well, how this coronavirus is different than the coronavirus that we see in the chicken houses that we vaccinate for, how this coronavirus is going to be spread from people to people, how can we keep our people safe, how are we going to be able to keep our plants running if we do get people sick, and how are we going to be able to disinfect our plants so that we can keep running, because the chickens don't care if we have sick people and don't have anybody to pack the eggs. They're still going to lay eggs.
Michelle: Now, speaking of some of those plants, the layer industry in the U.S. has had to switch from breaker eggs to shell eggs to help adjust to restaurants closing and grocery stores booming. Before I ask you what that really means, I want to give our listeners just a little bit of basic bird information. When you go to the supermarket, most eggs are large eggs. There are medium eggs; those are the shell eggs. Also, you see cartons of eggs, egg whites, mixed eggs, etc. Those are from the breaker egg market. Is that a correct understanding of the two things?
Kristi: Well, shell eggs — basically, breaker eggs come from shell eggs. We take shell eggs and take them to a specialized plant, where we break them open, take the juice out of the inside of the egg, and then plants will then take those eggs and put them in muffins or they'll put them in waffle mixes. What the biggest shift is, the places that utilize the liquid eggs are not running because people are not going to restaurants. People are not going to buy the convenience items as much. They're baking at home, so they're needing shell eggs. They're not needing liquid eggs that are already processed in a product.
Also, kids aren't in school and people aren't at work, so the liquid eggs that would have gone into those programs aren't being used. That whole market just stopped completely, and it's very hard to shift from taking eggs that were going into a liquid egg and then putting it into a shell, because some of those plants, the eggs come right out of the chicken house and go into an operation that cracks open the egg right away. There's no packing it in a carton. There's no putting it on a flat. There's nothing. It's right out of the chicken house into a liquid egg plant. That liquid egg now has no home, so that's one problem.
The other problem is that, sometimes, these plants were set up so that they were packing on flats that go into Denny's or IHOP or some of these other restaurants, and those restaurants are no longer serving, or if they are serving, there's very, very limited service and at a very reduced rate, so they don't have the packaging or the customer base or the ability to just take those eggs out of that flat and just go ahead and say, “Okay, now we're going to just go right into the grocery store.” It's a logistics nightmare to be able to get those eggs out of that direction and into the grocery store. It's not just flipping the switch and (saying), “Okay, here we go.”
Michelle: Are breaker eggs and shell eggs processed the same? You talked about how you have this market for eggs, but restaurants are closed. Those breaker eggs can't simply just go to a store. Talk about that processing plant situation and why that's the case.
Kristi: Well, breaker eggs and shell eggs are processed the same up to a point. They're all washed. They're all graded. Now, with shell eggs, they're graded based on external factors, like the shell has to be smooth and it has to be clean, to a certain extent. It has to not be cracked and it has to be a certain size. That's the kind of grading we do for shell eggs to go into a carton for the final consumer.
On a liquid egg plant, the eggs, after they're washed, we have people that are looking for the broken shells. They're looking to see if they're leaking outside of the shell, and then they're also looking to see if there are any internal problems that they want to pull out the egg, because we're just taking the juice out of those eggs. The process is similar in that they're washed, but from that point on, it's very different.
Michelle: I wonder if you can talk to us about the effect on the actual birds. Do they have shorter life spans? Does this all change the amount of eggs they lay if you're trying to go from breaker eggs to shell eggs, for example?
Kristi: No. The only difference might be the type of bird that we use. Some breaker markets, they're going to use a bird that lays a very big egg because they want the most juice out of the egg that they can get, especially if they're going right from the chicken house into the breaking plant, because they don't handle the eggs, so they're not going to be broken in any way. They're just going to go right in, be washed, be opened up and get all that juice out, whereas, when you have a shell egg market, eggs that are going into a grocery store, you want a certain percentage of large eggs and a small percentage of extra-large and maybe even a little tiny percentage of jumbo eggs and even a smaller percentage of medium eggs, because we still do have that market. We need a variety in there, and the shell has to be such that it needs to hold up to being packed into a carton and then handled again and taken into a grocery store, to where it'll be put on the shelf. People will open up that carton and see that the shells are still intact, and they want to take it home to their house.
Michelle: Speaking of eggs in the stores, at supermarkets and grocery stores around the globe, I wonder if — and I know the panic-buying has died down somewhat at this point — but are grocery stores requesting more eggs now due to a higher demand because of this pandemic?
Kristi: Yes, there's still higher demand, and depending on when you hit the grocery store, it's interesting. When they normally get their egg shipment, some companies are getting their same shipment that they've always been getting just because that's the amount they get, and so that's what they're getting. Some companies are set up that when they hit a certain level, that's when it orders automatically in their system, so they're having more and more ordered. It has to do with the different stores and how their ordering system is. It's more of a logistics matter.
I think that people are still buying a lot more eggs just because they're cooking at home. Kids are not back in school, so it's something easy somebody can make for breakfast. They are baking comfort foods at home, so they need eggs for baking. People are realizing how many things that they cook that they put eggs in and not even realizing, "Oh yeah, when we make this, we actually put eggs in this," so they're having to buy more eggs than they were in the past, when they were eating out more.
Michelle: With that large demand for eggs right now, how does that impact producers in North America?
Kristi: Well, it's interesting. The liquid egg market is basically zero. It's gone. With the shell egg market, it is starting to drop off just because the liquid egg producers and the producers that can change from packing eggs that went to the restaurants to go to the grocery stores are now starting to flood the market that way, so it's starting to come back down. There was a small jump in prices, but now, it's starting to come back down because it's starting to flood the market again.
Michelle: I'm curious if you can explain how easy or how difficult it would be to change the bird to lay eggs for the table egg market, for example.
Kristi: That's not something that you just go in there and say, "Hey, girls, we need to now just lay large eggs." You have to really plan that ahead of time. You have to feed her and set her up so that that's what you want to do. If you want all extra-large and jumbo eggs, because either that's what your market is or that's what you're doing for liquid egg, then you go in there and you give them light to stimulate lay or you go in there and you feed them based on that's what you're looking for.
When you want to change to just getting more of a large market — which is usually what people buy in the grocery store in our area, at least, is large — you have to think ahead and think about what kind of protein you want to feed her, when you want to give her light, how much light you want to give her, and changing that late in the lay is not something that you can just go in there and flip a switch. It's a lot harder than that.
Michelle: It sounds like it's quite a process. This increased demand, does that impact pricing?
Kristi: Yeah, and like I said, it was very short-lived. It was very short where there was a small jump in prices, but it wasn't a lot. We're very good (in the sense that) everybody rallies and gets eggs where they need to be. Eventually, it will really quickly level out, and there'll be plenty of eggs in the market. It'll be a flood again and the prices will be back down to a level that eggs are selling below what it costs us to make.
Michelle: Is there a difference in nutritional value with a shell egg versus a breaker egg for humans?
Kristi: No, ma'am.
Michelle: I'm curious if you can talk about what you see as the potential long-term impact on the poultry industry because of this pandemic.
Kristi: It's going to make people more aware of where their food comes, at least in the short-term. Unfortunately, people, I think, they forget very easily. They will forget that our teachers should be paid a million dollars and that our farmers are some of the most important people out there because we all need to be fed and that the truck drivers that get the food and the supplies to the grocery stores are very important.
They'll forget that sooner rather than later, but on the poultry industry, I think people will realize that, ultimately, we can't do this without the people that are working and are considered essential.
Michelle: We so appreciate all of their efforts. Kristi, are there consumer trends in the midst of this pandemic that you find interesting or relevant?
Kristi: I think it's interesting that people are baking and cooking comfort foods because it gives them a sense of normalcy.
Michelle: We all like comfort foods. Kristi, you've been doing this for almost two decades. Have you ever seen anything like this in the industry? People talk about this pandemic, and the word we keep hearing over and over again is “unprecedented”. Is the impact in the industry also unprecedented and something that you've never really seen or felt before?
Kristi: Never. I thought that the flu, the AI, that hit the industry in 2015 could never be topped, and this has definitely topped it, by far.
Michelle: You talk about AI. That's avian influenza. Can you describe how that was different than what we're experiencing today in the industry?
Kristi: I think (it was different) because people were more aware of what flu does to people, so people were more willing to accept that we needed to control it and we needed to get this tamped down; we needed to get this under control. It devastated the industry in the Midwest, definitely, and was an eye-opener for a lot of people on how to handle our biosecurity and how to keep things in check, how to monitor and how to look for things, but I think people were more willing to accept it and more willing to go with it because they understand flu and they understand, “We need to control this.”
When this coronavirus hit, I think it was so novel and so unique that it just was hard for everybody to wrap their head around. It was hard for everybody to figure out how to make this happen and how to make a normal life out of this and why we needed to do the things that we're doing. There are still people out there that are like, "Oh no, this isn't real. This is a hoax." Well, maybe not. We might need to keep figuring this out and getting this under control.
Michelle: You mentioned biosecurity. Has it changed once again with COVID-19 as it did, as you mentioned, with avian influenza?
Kristi: I think it made people realize that you can only control what is happening at the facility, and that's all biosecurity really is, is you can only control what is happening right there. I've had a lot of people say, "Well, I can't ask people to wear a mask even though they're standing shoulder to shoulder in this plant because they ride to work together." I said, “You've got to control what's happening at your facility. You can't control what happens outside your facility.” That's what biosecurity is about. That's what all this biosecurity, even with people, is about, is controlling what's happening at the facility and making sure that we keep animals safe as well as people safe.
Michelle: A lot of people, you said, have been turning to you to ask you questions specifically about COVID-19. What are people feeling? What are their emotions? What's on their mind right now?
Kristi: It's a very wide array. It's interesting to see how different people are reacting to this. I've gotten everything from "Oh my God, I've got the corona and I'm dying" to panic to sorrow to "This is a hoax and we all just need to get it and get over with it."
Michelle: Well, we certainly hope that, around the globe, we return to whatever our new normal is going to be sooner rather than later. Kristi, take care of yourself. Thank you so much for joining us today.
Kristi: Thank you for having me.
Michelle: For additional resources on COVID-19, visit alltech.com.