NatureFirst USA

Natural Eggs Producer `Egging On' Competitors

Denver Business Journal
July 26, 2002


While they aren't allowed to cross the road, the egg layers of Colorado
Natural Eggs -- which produces Nest Fresh Eggs -- have the freedom to
roam, roost and even rabble-rouse in a cage-free environment.

And even though a carton of Nest Fresh Eggs sells for as much as $2 more
than regular grocery-store and brand-name eggs, this local woman-owned
business is keeping pace with its corporate competitors, selling 36,000
cartons of eggs a week.

"How can we do it? We charge more," said Dave Turunjian, a Niwot farmer
who raises chickens exclusively for Colorado Natural Eggs."But 7 percent
of the population says, `I believe in this, it's worth it.'"

Cyd Symanski, owner of Colorado Natural Eggs, said she has her loyal and
discerning customers to thank for the company's success.

Symanski started Colorado Natural Eggs 11 years ago because she wanted to
give customers an alternative to buying eggs laid by chickens whose
quality of life she considered appalling.

With her entire family working in the egg industry, Symanski grew up
seeing the operations of caged producers like Moark Productions and Land O'Lakes.

Symanski said that while breaking away to stand up for what she believes
is right has made her something of a family outcast, her conscience would
not allow her to stand by and silently watch the mistreatment of millions
of chickens.

"Chickens aren't just one of those farm animals that your general public
takes to. They're just not as cuddly," said Symanski, who is herself
frightened of the animals. "But to cram a chicken in a cage in a dark
building where they don't see anything in their whole life is the pinnacle of cruelty."

For that reason, Symanski's company never has, and she says never will, use a cage.

The evolution to caged chickens occurred about 40 years ago with the
emergence of commercial farms.

"Originally all egg farms operated pretty much the way Cyd's operation is
now," explained Rex Thorpe, controller at Morning Fresh Farms Inc., a
family-owned Colorado caged facility. "The cages evolved essentially to
solve problems, most of them health-related."

But while cages resolved some problems, Turunjian argued that as cage
sizes decreased as efficiencies of scale became a priority, the caged
system brought about a new set of problems.

"The large farms did some very good things. They genetically improved the
hens and improved the health safety conditions," Turunjian said. "However,
what gave was the welfare of the hens."

Paul Osborne, vice president of Moark LLC, a local partner of Land
O'Lakes, argued that the 800,000 chickens on his farms in Roggins, Colo.,
live in a clean, safe and healthy environment.

"They're very well taken care of," said Osborne, who happens to be
Symanski's cousin. "I think you'll find that these birds, they're not
being mistreated."

Osborne explained that he and many other caged producers have voluntarily
pledged to participate in a program that would increase cage size
incrementally over the next six years to an eventual 67 square inches per
bird. Osborne said of the 270 million birds in the United States, 190
million birds' producers signed on to this program. While cage sizes vary,
Moark currently uses cages as small as 48 square inches.

Morning Fresh is already giving its birds 60 square inches, and is on its
way to allowing up to 76 square inches per bird.

Colorado Natural Eggs' cage-free approach to raising chickens is a little
more costly, but Symanski and her producers say the result is healthier
chickens and more natural, tastier eggs.

The company's free-roaming chickens can wander anywhere inside a
15,000-square-foot barn.

At Dave Turunjian's farm in Niwot, 13,000 noisy chickens mosey around each
barn, with about 1 square foot of space per bird. This means they have
space to lift their wings to cool themselves, and they can feed and nest
where they choose.

Previously, one barn held 33,000 caged chickens. After spending $300,000
to build a second barn, Turunjian's total capacity is still only 26,000.
"It's expensive. We spent more money to have less chickens," Turunjian
explained, noting that in addition to the expense of the reduced number of
birds, the free-roaming birds consume more feed because they use more
calories than their sedentary, caged counterparts. "They're healthier
because of that."

In addition to being cage free, Turunjian said, Colorado Natural Eggs is
unique because of its use of vegetarian feed and its no-chemical approach to farming.

With the success of Colorado Natural Eggs' cage-free product and a growing
segment of the market preferring organic or cage-free eggs, other
producers are moving in to tap that market.

On supermarket shelves, Nest Fresh Eggs sit side by side with King
Sooper's Private Selection cage-free eggs. Rex Thorpe said while Morning
Fresh Farms does not produce a caged-free product right now, it is always
a possibility in the future.

"It just depends on how that segment grows. If it's something our
customers ask us to do, then we would obviously do that," Thorpe said.
While they are not cage free, Land O'Lakes' new line of All Natural Farm
Fresh Eggs was released to meet demands for a more natural,
vegetarian-type product.

Nest Fresh Eggs sell for $2.79 a dozen, while Land O'Lakes All Natural
Farm Fresh Eggs for $1.99 a dozen. A dozen regular Grade A King Soopers
eggs cost $1.39.

Symanski said she is frustrated that Land O'Lakes natural eggs are priced
similarly to her own product because the eggs are not produced by
cage-free birds.

"If they were really selling a product comparable to mine, I would welcome
any competition. That's just business," said Symanski, explaining that she
thinks it is misleading to price the product to compete with cage-free
eggs when the only difference between Land O'Lakes All Natural Farm Fresh
Eggs and its regular eggs is the vegetarian feed given to the birds.

Osborne said he does not believe that the all-natural line is at all
misleading, noting that the packaging makes no claim to be cage free.

"I had no intentions of bringing that to the market to mislead the
consumer or take advantage of Cyd," Osborne said. He added that while he
does produce a cage-free line of eggs, he does not sell them in the Denver
market. "Cyd is a success story. I applaud her in what she's doing. I've
done my best to stay out of her way."

Symanski said that despite the competition, she has not lost any
customers. However, Colorado Natural Eggs has not seen the 15 percent to
20 percent growth it has experienced in past years. Symanski said she
attributes most of the lack of growth to the new competition, and the rest
to economic problems caused by Sept. 11.

To combat the competition, Colorado Natural Eggs is diversifying and
adding some new product lines. Oh!3 is a new Nest Fresh cage-free egg with
200 milligrams of omega 3 per egg, added through diet, that is scheduled
to hit the shelves in August. Commonly found in fish, omega 3 is a fatty
acid that is believed to prevent heart disease.

The company also will be releasing five varieties of a liquid whole egg
product called Scramblins and a free-range, all-natural and organic
poultry meat in the near future.


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