December 10, 2020

Costco to transition to cage free eggs

Costco Wholesale will transition to a new animal welfare policy that bans the use of cages in its global egg supply chain.

The policy covers Costco's international locations in mainland China, Taiwan, Japan, South Korea, Mexico, Australia, Canada and Europe. Costco's stock has risen 28% this year and is set to report its latest quarterly earnings soon.

"We are in the process of making that transition to cage-free eggs," said Josh Dahmen, financial planning and investor relations director of Costco in an email to investors this week. "We will continue to increase the percentage over time, with a goal of eventually getting to 100%, although this may take several years in some countries due to issues with availability." Costco is the first US retailer to issue a global policy against the confinement of animals used in the company's supply chain.

China Food Safety News reported on December 6 that construction is ongoing for a new egg laying farm with a capacity for 50,000 cage-free hens to supply eggs to Costco in the country.

Costco launched its first store in China in 2019 and registered over 200,000 members in its first few months, and with additional stores set to open in 2021. As of 2019, Costco reported it had 239 international stores, with international locations accounting for nearly one-third of the company's total store count.

Studies by the European Food Safety Authority found caged egg farms have higher rates of contamination from key salmonella strains as compared to cage-free farms. In recent years, selling of caged eggs has been banned in Costco's home state of Washington, the United States, as well as in the US states of California, Oregon, Michigan, Massachusetts and Colorado.

"In addition to focusing on animal welfare because it is the right thing to do, Costco believes the failure to do so would create risks for the business and its shareholders," Costco noted in its updated animal welfare policy. "The failure to provide adequately for the welfare of animals throughout Costco's supply chain could have significant adverse effects on the business and operations of the company and its investors."

"We applaud Costco for this landmark decision to use only cage free eggs throughout its global supply chain," said Kirsty Tuxford, programme manager with Lever Foundation, a Pennsylvania-based animal protection non-profit that worked with Costco for the past two years on making the commitment.

"Costco's move will spare millions of animals from being confined for their entire lives in cages so small they can barely turn around. We commend Costco for being the first US retailer to address this key animal welfare and food safety issue throughout its global supply chain."

 - The Poultry Site