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Nestlé, other corporations flock to cage-free eggs

Nestlé, the world's largest food company, is jumping on the cage-free egg bandwagon.

The company on Tuesday said it would transition to using only cage-free eggs in all of its U.S. food products within the next five years. The planned shift is an especially quick one, given Nestlé currently does not use any cage-free eggs in its products.

"It is a quick ramp up, and not an easy change," said Paul Bakus, head of Nestlé's corporate affairs office in Washington, D.C. "The good news is the [egg] industry has recognized that this is not a fad, and more and more companies are going cage free."

The company uses approximately 200 million eggs, or 20 million pounds, annually to make U.S. food brands including Haagen-Daz ice cream, Toll House cookie dough and Buitoni pasta.

Amid campaigns by animal-welfare activists, consumers have grown more concerned about the conditions in which egg-laying hens reside, prompting a slew of companies to go cage-free in recent months and weeks.

"The latest trend has been more and more customer demand for cage-free and cage-free egg products," Andrew Seger, chief financial officer at Ballas Egg Products, which supplies liquid, frozen and dried eggs to Nestlé and other companies."We've seen some very large companies make these commitments over time."

In November, Nestlé competitor General Mills (GIS) said it would only use cage-free eggs by 2025, while Kellogg vowed to make make the move by 2035.

Restaurant chains have also joined the movement, with Taco Bell targeting the end of 2016 to only use cage-free eggs, and Burger King looking at a 2017 deadline. McDonald's (MCD) plans to only serve cage-free eggs in North America within 10 years, and Panera Bread vowing to be cage free by 2020.

Stung by the June release of undercover video footage allegedly showing mistreated birds and unsanitary conditions at a Pennsylvania eggs supplier, Costco Wholesale (COST) has been steadfast in its refusal to commit to a schedule to go switch to only cage-free eggs.

That said, the grocery retailer recently posted a statement on its website expressing its commitment to make the transition, while adding the move would take time "because currently over 90 percent of the supply of eggs is from caged hens and because other retailers and restaurants are also moving to cage-free requirements, placing greater demands on the limited supply."

Today, 26 percent of eggs sold by Costco are cage free, up from 2 percent in fiscal 2006, the company said.

Nestlé said it would develop pilot projects with its suppliers and World Animal Protection to establish a strategy for sourcing cage-free eggs in Europe and the rest of the world.

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