Course Learning Outcomes: 1, 2, 3, 4 & 5

Topic/s of Primary Focus:   Perfect Competition

(May also include content from previous topics.)

Read the following The Conversation article‘What’s causing Australia’s egg shortage?

A shift to free-range and short winter days’(10 August 2022)

https://theconversation.com/whats-causing-australias-egg-shortage-a-shift-to-free-range- and-short-winter-days-188433

Australia is experiencing a national egg shortage. Prices are rising and supermarket stocks are patchy. Some cafes are reportedly serving breakfast with one egg instead of two. Supermarket giant Coles has reverted to COVID-19 conditions with a two-    carton limit.

We became used to grocery shortages throughout the lockdowns of 2020 and 2021. These were due to changes in buying patterns, stockpiling and panic-buying. Eggs were temporarily part of this, along with flour, as people at home got baking.

But with lockdowns long past, what’s causing this egg shortage now?

News reports have quoted eggs producers blaming, at least in part, pandemic    restrictions – because they reduced their laying flocks due to lower demand from restaurants and cafes.

That was the case in countries such as India, where misinformation about poultry being a source of COVID-19 led to a sharp decline in demand. But in Australia, an initial 30% drop from hospitality was compensated by a growth in retail sales.

What changed during that time was the way people got their eggs. Food delivery, food boxes and home cooking exploded for a time.

More fundamentally, this shortage reflects a long-term trend in egg-buying               preferences, with a shift to free-range eggs, whose production is more affected by the colder, shorter days of winter.

Shifting to free-range eggs

Australians consume about 17 million eggs every day. In the 2020-21 financial year, egg farmers produced about 6.3 billion eggs. Of those, 52% were free-range. This    compares to about 38% a decade ago.

This growth, however, has not been consistent. Between 2012 and 2017, free-range eggs’share of the market grew about 10 percentage points, to about 48%. Growth in the past five years has been half that.

But with more rapid growth predicted, and the promise of higher profits, many egg    farmers invested heavily in increasing free-range production. In New South Wales, for example, total flock size peaked in 2017-18.

Like many agricultural industries where farmers respond to price signals and             predictions, this led to overproduction, leading to lower prices and profits. This in turn led to a 10% drop in egg production the next year.

Compliance costs also increased. In 2018 the Australian Competition and Consumer Commission introduced rules to police the marketing of eggs as“free-range”.

These rules mean hens need to have“meaningful and regular access”to an outdoor range during the daylight hours of their laying cycle (with a maximum density of     10,000 hens per hectare).

This experience has likely influenced farmers’reticence to increase their flocks based on predictions of higher demand.

Winter affects free-range production

Producing free-range eggs is more expensive not just because it requires more land. Free-range hens are less consistent layers.

Hens kept in cages or barns are more regular producers because conditions are          optimised to stimulate laying. Temperatures are constant, and hens are exposed to 16 hours of light every day.

Free-range hens are affected by hot or cold temperatures, wind and rain, and length of daylight. In winter months they have less energy and produce (on average) 20% fewer  eggs than a chicken confined indoors in controlled conditions.

Pressures on farmers

The egg industry is flexible and adaptable – but the confluence of economic and   environmental events in 2022 has made things difficult. Farmers will want to meet demand, but face time lags and cost pressures.

Increasing a laying flock takes about four months. An egg takes about three weeks to hatch. Under ideal conditions, chicks need another 17 weeks before they are ready to begin laying.

Any farmer who has begun this process in the past month will be producing more eggs by December. But then it will be summer, when they won’t need 20% more hens to       make up for their winter slump.

Feed costs, which typically represent 60-70% of layer production costs, have been increasing along with transport, electricity and interest rates.

So farmers must be cautious if they are to stay in business. It is preferable to undersupply than go bankrupt through oversupply.

Are farmers willing to invest in increasing production in an uncertain economic       environment, with interest rates and costs going up and a recession on the horizon? Probably not.

So a short-term fix seems unlikely. Weather forecasts are not favourable. The Bureau  of Meterology expects a wetter August to October, with“more than double the normal chance of unusually high rainfall”. That means less daylight and more cold. Blame the negative Indian Ocean dipole, not the chickens.

Come spring, with longer days and milder temperatures, along with an agricultural visa program, things should return to“normal”.

Unless consumers are willing to pay more to ensure a constant supply in winter      months, our shift to free-range eggs carries a higher likelihood of winter shortages.

We must do what we have done through every disruption in recent times: endure, adapt and prepare for the next crisis.

Task:

In Summative Assignment 3 you will be asked to apply the model of Perfect          Competition to the Australian free range egg market. Discuss how well this market meets the assumed conditions for‘perfect competition’.

Where possible, look for evidence within the article.

How this Peer Review Assignment relates to Summative Assignments:

You will address the same case study in both Peer Review Assignment 3 and    Summative Assignment 3. You will be given a different task to address for each assignment. So your response to Summative Assignment 3 will build upon your analysis presented in this task.

Format:

The format of your response should be an essay-style response.

You do not need subheadings or subsections.

You do not need to spend as much attention on formal essay structure as you might   for a persuasive or research-based essay. Instead you should focus on communicating your ideas in a clear and concise manner and making sure there is a logical flow of     ideas and explanation.

Word Limit:

800 words (excluding diagrams and references)

Diagrams:

Unlike previous weeks, this task does not necessarily require diagrams. However you may choose to use diagrams if you wish.

Where you use diagrams, they should usually be created by you. You could either draw them by hand and scan/photo them into your document. Or prepare them                   electronically. If you wish to include other diagrams, tables, or figures (such as those   from the article), make sure that you include an appropriate reference.

Referencing:

This is not a research assignment. So you do not necessarily need to find other      references. You should answer the question based on what you have learned in the course and the excerpt provided.

However, it is important that if you do take content directly from other sources     including course materials, both quoting and paraphrasing, that you appropriately

reference to show what is your own original thoughts and what ideas you have          borrowed from others. Please refer to the                                                                 https://www.adelaide.edu.au/writingcentre/resources/avoiding-plagiarismfor further guidance and links regarding referencing, plagiarism, and academic integrity.

Where referencing is used, it can be in any standard style, so long as it is consistent. The Harvard referencing style is preferred, as it is the standard in Economics and is

also common in Business disciplines.

https://www.adelaide.edu.au/writingcentre/resources/referencing-guides

All submissions may be analysed with the assistance of Turnitin, checking for plagiarism against other students in the class and external sources.

Submission

Students must submit the assignment by the due date via the Feedback Fruits

electronic submission portal on MyUni (the same page you downloaded this pdf!).

https://help.feedbackfruits.com/en/articles/2942398-peer-review-student-perspective

It is students’responsibility to ensure that it is correctly submitted by the due date, and that all requirements are met, including peer review and viewing requirements.

Late submissions will generally *not* be accepted at all. Not even one minute late.    This might seem more strict than some of your other classes, but do keep in mind that we also have a‘best 4 of 5’policy on the Peer Review Assignments. And in fact, the   entire Peer Review Assignments grade is redeemable by the final exam, making it      ‘optional’to some extent.

If you have a medical or other circumstance that have impacted your ability to      undertake this assessment, please email the course coordinator for advice. Do note however that due to the inter-relation with other students, that extensions will      generally not be able to be granted for this assessment type.

Peer Review Process and Timelines

Complete the task as directed above, and submit an electronic document by the due date, 11:59pm Sunday 11th September.

After the due date has passed, you will be allocated another student's assignment to  review against the assessment criteria on an online rubric. And once you have             completed this, a second paper to review will also be allocated. Students have up until 11:59pm Wednesday 14th September to complete these reviews.

Student also earn grades even for viewing their feedback. This must be completed by  one week after the assignment due date, so 18th September in this case. Grades will be transferred from Feedback Fruits to the main MyUni system after the 18th September.

Peer Review – How to think like a course grader

The assignment should be graded against the Assessment Criteria in the Rubric attached to the Feedback Fruits assignment and detailed below.

Grades should be allocated in-line with the University’sgrade descriptors.

The grade is not a matter of where the student‘lost marks’, but rather the evaluation of what the student has presented against the standards and the assessment criteria.

You will allocate the score on each Assessment Criterion on a rating scale from 1 to 10. This will be scaled automatically by the system to give different make weighting for    different criteria as detailed in the table below. But you as the peer reviewer should be giving each a rating from 1-10.

Please provide text comments and feedback to provide suggestions, point out any errors or misconceptions, or justify the allocated grade.

Be polite and take this seriously and professionally.