22 September 2017 | Online since 2003

12 September 2017

Farmers face bankruptcy as retailers seek fipronil damages


EU eggs being tested for fipronil

Dutch egg farmers are facing the threat of total ruin, with supermarkets demanding compensation from them for the fipronil scandal.

Eric Hubers, chairman of the country's egg industry association, Ovoned, reckons financial losses for egg producers have already topped more than 60 million Euros and the bill is still rising.

More than 2.5 million birds culled, farms prevented from marketing eggs and, he says, perfectly good eggs destroyed in what he believes has been an over-zealous reaction by Dutch authorities.

Affected farmers have been moulting birds to stop egg production and "de-tox" their hens.

Now, lawyers acting for supermarkets and food companies have warned that they are seeking damages from the farmers.

Eric Hubers told The Ranger that they wanted not only the cost of egg and product recalls covered, but they also wanted damages for loss of profits.

Eggs and products containing eggs have been withdrawn from stores across Europe, including the UK, following the discovery that the banned chemical fipronil was used in a treatment for red mite.

'Farmers won't survive'

"Farmers won't survive," he said, "but they are not to blame," said Mr Hubers, who told delegates at the International Egg Commission Conference (IEC) in Bruges, Belgium that farmers were the victims of fraud.

Two people, directors of a company that apparently used fipronil in the treatment of red mite on Dutch egg units, have been arrested in the Netherlands as part of a criminal inquiry.

Eric Hubers said that farmers had been assured by the company - Chick Friend - that the treatment contained only essential oils and a secret ingredient that was safe and accepted in organic poultry systems.

"It worked for months and it was a solution for the farms," he said. "Their success was the reason for over 200 Dutch farmers hiring them. This is about 20 per cent of Dutch production."

The truth came to light when fipronil was found in eggs from Dutch farms.

'Catastrophe'

Now egg producers are facing what he says is a "catastrophe" and they are doing so without any help from the Dutch authorities.

In Belgium, where 1.5 million birds had been culled, farmers had had financial support from their Government, said Eric. This was not the case in the Netherlands.

"The financial loss by the middle of August was already 33 million Euros. That has doubled at least by now. And it will increase a lot also by claims by supermarkets and the food industry. They have already sent a declaration to the farmers that they will claim all the costs they have made."

Mr Hubers said that one packing station caught up in the crisis had lost 80 per cent of its egg supplies as a result of what had happened.

"They have contracts with supermarkets and they have had to go and buy eggs on the open market. And prices are high because there is a shortage of eggs," he said.

Bankrupt

Mr Hubers said that farmers had so far seen no figures put on the level of compensation that supermarkets and food companies were seeking but he said that, if the claims succeeded, then farmers would be made bankrupt.

"We are contesting this claim because it is not the farmers' fault," he said.

The latest official cull figure in the Netherlands is 2.5 million birds but Mr Hubers says the true figure will be higher.

He said that more birds were being culled all the time. Most farmers affected by the crisis had been trying to "de-tox" birds by moulting them.

The theory behind this is that fipronil is stored in the bird's body fat. Moulting the birds reduces the body fat and so reduces the fipronil.

But Mr Hubers said it was very difficult to reduce the fipronil to an acceptable level.

"About four million hens are starting to lay again after the moulting period. The samples of the first eggs will determine their destiny. It is very difficult to get under the residue level."

Detox

Eric Hubers said that the "de-tox" could only be successful if the poultry house the birds were in was thoroughly cleaned first to prevent the hens being contaminated again afterwards.

"A lot of effort has been done to clean the poultry houses but it is really difficult. Especially when the hens are still inside."

For older birds, it was not worth the attempt to clear them of fipronil, he said, but for younger birds with a longer productive life ahead of them it was worth trying, particularly when it was not easy to obtain replacement flocks.

Moulting also has the effect of stopping egg production - an economic necessity for Dutch farmers who are still under restriction and unable to market their eggs. Some 144 farms remain under restriction in the Netherlands.

This is allowed under EU regulations, although it would be controversial in the United Kingdom, where it is banned under the Lion code.

Mr Hubers said that during the fipronil crisis the authorities in the Netherlands had imposed far stricter tests on eggs than authorities in some other countries.

Recalls were much less severe in Germany and some other countries, he said. In the Netherlands, he said eggs that posed no threat to food safety had been recalled and destroyed.

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