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Egg producers buckle down as avian flu creeps toward Pa.

EPHRATA, Pa. - Here in the heart of Lancaster County, where the Shell station proudly boasts "We have worms," and the dark rolling earth turns green with corn, soybean, or tobacco crops, the chicken egg is king.

Chickens in a Lebanon County farm that produces eggs for Sauder's Eggs, one of the country's largest egg marketers.
Chickens in a Lebanon County farm that produces eggs for Sauder's Eggs, one of the country's largest egg marketers.Read more

EPHRATA, Pa. - Here in the heart of Lancaster County, where the Shell station proudly boasts "We have worms," and the dark rolling earth turns green with corn, soybean, or tobacco crops, the chicken egg is king.

"We are the No. 1 county for egg production in the U.S.," says Paul Sauder, 64, a third-generation egg producer, who has seen the boom and bust times since he was a boy working with his grandfather selling eggs, chickens, and produce door-to-door in Philadelphia. "We have more chickens producing eggs in Lancaster County than in any other county in the United States."

That's high cotton for an egg man, but in light of the avian flu epidemic that has struck much of the country's egg producers, Lancaster also presents a dangerous target for disaster. Dr. Sherrill Davison, of the University of Pennsylvania School of Veterinary Medicine, says the latest outbreak is "unprecedented in the United States for its scope - number of birds, number of premises, number of states - and economic damage to the poultry industry."

As of June 17, about 48 million birds had been killed at 223 chicken sites in 20 states, as far east as Indiana. Losses have totaled $300 million in Minnesota and $600 million in Iowa.

The wholesale price of eggs roughly doubled in early June to about $2.40 a dozen for grade A eggs, the U.S. Department of Agriculture found. That price has dropped recently to just below $2 a dozen. But that does not include the built-in markup at your local grocery.

Industry reports indicate that many companies that rely on eggs - restaurants, bakers, grocery chains - are absorbing the higher prices and not passing them on to consumers, at least for now.

Can Pennsylvania prevent the spread of flu?

"No, we cannot," said Paul's son, Mark Sauder, who became president of the business July 1 when Paul retired. "It's spread through wild birds in migratory patterns. There's nothing we can do there. Can we take steps to keep it off our farms? Absolutely. We are doing those things.

"We are making sure that all employees wash down and disinfect their vehicles coming onto the farms. We discourage wild birds from roosting and hanging out on the farms. There is no spilled feed, no water puddles for them to get water from. And we're limiting the number of guests on and off farms."

Should the avian flu enter Pennsylvania, it would bring back dark memories in the nation's fourth-largest egg-producing state.

And Paul Sauder remembers it all well.

"I lived through it during the 1983-84 [outbreak in Pennsylvania], and it was the most gut-wrenching experience that you can go through," said Sauder, now chairman of the American Egg Board.

To keep the company's supply chain going to its wholesale and retail clients, Sauder said, he bought eggs outside the affected area and sold them below cost to keep his customers happy.

After the 1983 outbreak, the federal government spent $60 million to wipe out the disease in the state, Sauder said.

He recognized that to survive future outbreaks, he would need to literally not keep all his eggs in one basket. "We needed to diversify our supply and get it out of not just Lancaster County," he said.

Now, Sauder's Eggs has three egg-processing centers, one each in Pennsylvania, Ohio, and Maryland. So if flu comes, "we're going to have a supply that is roughly 400 miles apart from each other."

As one of the country's largest egg marketers, Sauder's Eggs relies on 6.5 million chickens that produce regular, cage-free, and organic eggs. The company works daily with a network of more than 100 family farms, employs about 400 people, and moves more than 30 million eggs a week to market, said Mark Sauder, the fourth-generation leader.

Sauder's Eggs got its start in the 1930s when Frank Sauder began going door-to-door in Philadelphia selling the fruits of Lancaster labor.

Great-grandson Mark, 37, studied business at the University of West Virginia, worked with Enterprise Rent-A-Car and as a mortgage broker before returning for good about eight years ago. But it wasn't his first day on the job.

"Mark has been a full-time member of the company since he could walk," Paul Sauder said. "When the snow came and he didn't have school, we would go and draft him."

The avian flu outbreak could not have come at a worse time, Paul Sauder said, not that there is ever a good time. He has seen his beloved egg find new footholds in America's diet, even getting a reprieve on cholesterol. Sauder said U.S. egg consumption had recently risen to about 265 eggs per year per person, up from the 230s of years past, but far from the 400s in the 1940s.

Egg farmers were hoping to reap the benefits of a late March McDonald's announcement that the fast-food giant would serve Egg McMuffins all day. While the idea is being piloted in a few markets, Sauder said the concept has "been put on hold because of the egg shortage."