• Dr Janine Curll

Free Range Egg Fraud alleged in WA. Australian traceability requirements do not prevent food fraud.

Updated: May 14, 2019

Australia's peak consumer and competition body is investigating reports of eggs being fraudulently packaged and sold as free-range in Western Australia. Dr Janine Curll (FFP-Ed) provides some commentary below and asks the responsible State Ministers at the Food Regulation Forum (food policy makers): Where is our authenticity monitoring compliance and enforcement strategy? Where is Australia's food fraud strategy? The time has come to identify food fraud as a food regulatory issue and systematically protect consumers and, importantly, provide a fair marketplace for honest food industry traders. [https://www.abc.net.au/news/rural/2019-05-13/accc-investigates-rotten-conduct-wa-free-range-egg-industry/11102190]


Key points:

- There are concerns that caged and fertilised eggs, laid by hens raised for meat, are being trucked into WA and sold as free-rangeWA's Agriculture Minister, Alannah MacTiernan says the ACCC is investigating the allegations

- Some local producers say they are fighting a price war between egg suppliers and supermarkets

- WA's Minister for Agriculture and Food, Alannah MacTiernan, sent a letter to the Australian Competition and Consumer Commission (ACCC), raising concerns that caged and fertilised eggs, laid by hens raised for meat, were being trucked into WA and sold in free-range cartons.

-In response, the ACCC told Ms MacTiernan an investigation was underway.


'Prima facie' evidence

Ms MacTiernan is urging the state's egg producers to provide proof of egg substitutions to ACCC investigators. (FFP-Ed: The government has more power to investigate than producers. This is an overly onerous expectation on producers. Where is our national, routine authenticity monitoring strategy Ministers? Prevention is key to avoid the inevitable)


We have said to the industry, 'it's really important that you get your absolute best evidence over to the ACCC so that we can get a proper result out of the investigation'," she said.


Ms MacTiernan said producers had already presented her with mounting but not conclusive evidence of malpractice within the industry.


"We've got white-shelled eggs coming in from the eastern states, and a percentage of these are fertilised, which tends to suggest they are coming from the meat industry, and that they are likely to be eggs that have not been reared in the designated free-range style," she said.


"On balance, I think there's sufficient evidence there to say we do have a problem."

An Australian free range egg barn

Peter Bell is managing director of WA-based company, Golden Eggs, and he has been providing reports to the ACCC since 2008 alleging some operators have been labelling barn or caged eggs as free-range.


"[Egg substitution] does exist, and it's sometimes hard to identify, particularly if it's caged eggs put into free-range or indeed into barn branding," Mr Bell said.


Egg price war


Mr Bell and other local producers are fighting a price war between national egg suppliers and supermarkets, and alleged malpractice is not helping the situation.

"We would like to operate on a level playing field," Mr Bell said.

Peter Bell is managing director of WA-based company, Golden Eggs.

Drought in parts of New South Wales and Queensland have driven up the price of grain and feed, and Mr Bell's production costs have risen considerably in the past year.

Those rising overheads were not being reflected in the price of certain free-range and barn-laid eggs being sold on supermarket shelves, according to Mr Bell.


"To us, as suppliers of eggs, that just does not make sense. It's just not possible to produce a barn egg at cage price and sell it for $3 a dozen," Mr Bell said.


"If the price sounds too good to be true, then maybe it is too good to be true."


In a statement, Aldi said it maintained rigorous quality assurance practices to trace their eggs from farm to pack. (FFP-Ed: Australian traceability requirements do not prevent food fraud, especially not substitution in complex supply chains)


Coles and Woolworths said they audited suppliers of their 'Own Brand Eggs' to ensure strict traceability requirements were met. (FFP-Ed: Again, traceability requirements do not prevent food fraud, especially not substitution)


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However, they did not comment on the traceability standards in place for independent egg brands sold on the major supermarkets' shelves.


This is not the first time that members of WA's egg industry have come under scrutiny.


In 2017, the ACCC took legal action against WA egg producer, Snowdale Holdings for falsely claiming some of its products were free range.

Undermining consumer confidence

Ian Wilson is a third-generation egg producer and president of the Commercial Egg Producers Association of WA.


Members of his association have complained of unrealistic prices being offered by supermarkets. (FFP-Ed: This is a key suggestion fraud is in our supermarkets. Supermarkets must be aware of the price driving fraud attempts and mitigation strategies for this practice must be implemented)


However, Mr Wilson said consumers ultimately and unwittingly beared the cost.

"It probably undermines the legitimacy of a product being offered to the consumer, and we believe the truth in labelling is paramount, and yes, the consumer should be getting what they pay for," he said.


There are traceability measures in place, such as the Australia New Zealand Standards Code that requires individual eggs to be stamped with the producers' unique identification, so they can be tracked. (FFP-Ed: Where in the supply chain are they stamped? This can not be assumed, as the Egg Tracing standard is a food borne illness tracking measure, not a prevention measure for fraud and substitution)


Mr Wilson said that traceability system needed to be strengthened.

"We believe it's a matter of urgency, as every week that goes by, there's a bill that comes to farmers and they are struggling to pay it," he said.


For the free-range egg industry, a National Information Standard, under the Australian Consumer Law, came into effect in April 2018.


The ACCC released guidance for egg producers on its approach to enforcing the laws.

However, Ms MacTiernan said an assurance system to provide customers with confidence was missing. (FFP-Ed: Yep!)


"We need to move towards a sort of mandated provenance scheme so that consumers can know, with some confidence, if they are buying something labelled free-range, that it's coming from a farm that is obeying the laws," she said.


The ABC has contacted the ACCC for comment, however, it declined, citing a policy of not disclosing any potential investigation to the media.


{https://www.abc.net.au/news/rural/2019-05-13/accc-investigates-rotten-conduct-wa-free-range-egg-industry/11102190}


Dr Janine Curll - Ed. and owner of Food Fraud Protection at www.foodfraudprotection.com. Contact Dr Curll for a confidential discussion on how you can identify food fraud practice vulnerabilities in your supply chain and strategically protect your brand against the ubiquitous fraud opportunities.

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