Uk farmers are losing money on every egg they produce
(media.conspiracies.win)
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I'm perplex are the prices regulated? Why don't the farmers refuse to sell the eggs unless they are sold at a profit?
Because the money is in the SUBSIDIES .
The problem is supermarkets are so aggressive with their pricing, and are slow to raise prices. There will be some farmers out there that bought significant amounts of say chicken food on the old lower prices that are still able to make a profit with the current prices, but this is a temporary situation at best. Supplying a supermarket with anything is not a business I would like to be in.
Aka The Cobweb Theory
Or, the hog cycle.
Price goes up, so production goes up, leading to over supply and price crash, to under supply, to price rises - due to the lag between price change and hog life cycle.
Supermarkets tell you what they will pay.
Take it or leave it.
The supermarkets themselves operate on about 6% gross margin.
The whole system operates on a knife edge.
Walmart sold Asda, the UK's second largest, because it was too much risk.
In the states farmers are able to sell direct to consumer, so when the grocery store don't buy the product the local community generally does especially if the item is hard to get at the supermarket