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Eggheads is for people who want to better understand the egg industry and the world surrounding it. Host Greg Schonefeld shares the stories of the people and companies that have shaped agriculture while connecting the different pieces of the industry, from where an egg begins to how it ends up on your plate.
Along the way, you’ll hear from producers, suppliers, and industry leaders, while gaining context for the economic, regulatory, and consumer forces shaping the industry. We look at where the industry has been, where it is today, and where its headed next. Our goal is not only that you gain a broader perspective, but that you gain a broader sense of connection.
Margaret Hudson:
It's tended to be a field of dreams when it comes to launching new shell eggs. If you build it, they will come.
Greg Schonefeld:
I'm Greg Schonefeld, and this is Eggheads. Today, we're taking a step outside of the American egg business, but we're not going all that far.
Margaret Hudson:
Yeah, so we would be the largest egg producer in Canada, and we operate in five provinces. We have eight wholly owned farms that we manage ourselves, but we also source eggs from over 400 egg farmers across the country.
Greg Schonefeld:
That's Margaret Hudson, the president and CEO of Burnbrae Farms, a company that began as a regional egg producer, but now has a national presence and a line of products that goes way beyond shell eggs.
Margaret Hudson:
Short shelf life liquid to extended shelf life. So we process simply egg whites, hard-boiled eggs. We do egg bites and omelets and patties.
Greg Schonefeld:
But despite their incredible expansion, Burnbrae remains a family business, and it all started when Margaret's great-grandfather immigrated to Canada from Scotland in 1874.
Margaret Hudson:
He was a dairy farmer in a stone mace and really not able to own land in Scotland. And he immigrated here with his family in 1874 and ultimately purchased our farm. And we now have six generations of our family on that same family farm.
Greg Schonefeld:
And for the first few decades on that farm, the focus was cattle, but that all changed when Margaret's father was a teenager.
Margaret Hudson:
My dad, when he was 13 years old, it would've been 1943 in the middle of World War II, that he took agriculture in school and he brought home 50 chickens, and that's when they were starting to get into the new genetics. The words were always sort of mixed. They did it all. They were meat, they were layer hens.
Greg Schonefeld:
And as time went on and the flock grew, it became clear that he had a talent, not just for the physical act of farming, but also the business around it.
Margaret Hudson:
At a very young age, he realized he was making as much money taking eggs to be dried, to be sent over to Europe to help feed Europeans during the war as we were off our dairy farm at the time. And so it was really his thing to kind of grow the poultry and increase the bird numbers. And we had several thousand layers by the time he graduated from high school.
Greg Schonefeld:
After high school, Margaret's dad was given the choice to either stay on the farm or attend university. He chose the farm and that decision would lead to a national coast to coast egg empire. Today, we'll look at how Margaret and her family kept building on what he started, including turning a low value egg byproduct into a national brand, funding research behind one of Canada's early omega-3 products and even helping major retailers rethink how they manage the egg category.
Margaret Hudson:
Certainly by the early '90s, we were very strong in Eastern Canada, Ontario, and Quebec. And I think when some of us started to join the business, the next gen, dad, I think, decided that he would start to pursue his dream to become fully national. And it was in the mid '90s when the first move was to purchase grading assets. Actually, the big retailers used to grade their own eggs. So Safeway at the time was still grading their own eggs. This is obviously a large US retailer that also operated in Canada. They have since sold. And we purchased their grading assets in Winnipeg and in Calgary, which is more Western Canada. And then also there was a further processor in Winnipeg that my father purchased. So we're very much growing through acquisition and that's how we expanded out west.
Greg Schonefeld:
So it was their acquisition of grading assets that allowed Burnbrae to expand their operations westward, but it was actually their innovation on the product side that helped them establish a truly national presence.
Margaret Hudson:
We started to produce extended shelf life liquid eggs in the mid '90s, and we actually became national when we launched simply egg whites. We'd been producing egg yolk, selling egg yolk for mayonnaise and ice cream, and we had this byproduct called egg whites. We were basically shipping away our egg whites pretty much at a loss because they were a byproduct of egg yolk production. And I was encouraged by our plant manager and our Quebec breaking plant to work on trying to figure out how to commercialize the egg whites. And so, we launched that product back in 97, 98. Up to that point, all our eggs had been distributed through direct store delivery, like direct to the retail stores. And so we made the choice to go through the warehouses of the retailers. And so that product was distributed coast to coast through retail warehouses.
Greg Schonefeld:
Really interesting. So was that liquid egg whites or-
Margaret Hudson:
Yes.
Greg Schonefeld:
It was? Okay. Was that kind of becoming a thing in Canada or somewhere else in the world that you saw it?
Margaret Hudson:
So at the time, if you call egg beaters, it was actually on the market in the US. Egg beaters, of course, being egg white based, right?
Greg Schonefeld:
Yeah.
Margaret Hudson:
So we chose to launch the pure egg whites at the time. We also subsequently launched a product called Egg Creations, which is sort of the same premise of egg beaters, which is egg whites with other ingredients that help it to have the same taste and texture as a whole egg, but also a liquid product. At the time, if you recall, it was through the '70s and '80s that the cholesterol myth evolved and eggs got demonized for their cholesterol and egg consumption did drop dramatically as a result of that. In fact, when I joined the business in 1990, egg consumption was declining.
Greg Schonefeld:
So you had this stream of egg whites that were just going to waste. And then at the same time, there were these growing concerns about cholesterol that were driving people away from traditional shell eggs. Simply egg whites seemed to solve both of these issues at once by commercializing that waste stream and marketing it as a healthier alternative. And in terms of Burnbrae's product innovations, that was really just the beginning.
Margaret Hudson:
Another early innovation would've been the omega-3 egg. That was back in the early '90s as well. I mean, Canada did not even legally recognize omega-3 as a nutrient until we launched eggs. And part of the process to get the eggs launched in Canada was for Canada to recognize a source claim. And we actually launched the omega-3 egg back in 1996 based on a temporary marketing agreement letter with Health Canada that allowed us to put a source claim on our carton of source of omega-3. And that's how basically the source for omega got established in Canada, first with eggs, I believe. And that, if you think now omega is massive, but eggs were very early in the commercialization. And I used to go to conferences and I'd be educating dieticians around what the different forms of omega-3 were back in the mid '90s. And interestingly, if you look at egg consumption, it started to shift from a decline to growing with a lot of the new products coming on the market, whether it was omega or egg whites or cage-free, free run eggs at the time.
I think a lot of the innovation helped to open up new consumer demand to take interest in the category again. And that was a really important turning point for our industry to stop the decline and start the growth.
Greg Schonefeld:
Yeah. It sounds like at that time Canada wasn't sure about omega-3, but you were.
Margaret Hudson:
We'd actually sponsored research at the University of Guelph, which is in Ontario, Eastern Canada, and feeding chickens. Basically flaxseed is the main ingredient that will take up omega-3 in the eggs and able to get to a very high level of omega-3 in the eggs. You can keep going higher, but the eggs will actually taste quite fishy.
Greg Schonefeld:
Oh, okay.
Margaret Hudson:
Yeah. So I think our eggs have 400 milligrams with a source claim being 300 milligrams. And now they actually have RDI's, recommended daily intakes for women and men. I think female it's 1100 milligrams a day. And guys, I think it's like 15 or 1600 milligrams a day.
Greg Schonefeld:
Okay. And at this time, based on your own research, you guys had a conviction, "Hey, this is good for people and we believe it and we want to make it happen," sort of thing.
Margaret Hudson:
Yes, absolutely. So we brought these eggs out in, I think it was 1996. It's a 30-year anniversary of omega-3 with Burnbrae, and we're able to gain consumer acceptance, I think rather rapidly, but we had to do a lot of work to try to educate consumers and even dieticians around what Omega-3 was and why it's good for you. Now it's everywhere. I mean, I eat only omega eggs, but I also take fish oil supplements. It's tied to inflammation, with inflammation being at the base of all chronic disorder. If you can keep your low grade inflammation down, you actually age more slowly. So really trying to get enough omega-3 in your diet is very important.
Greg Schonefeld:
Canada wasn't on this omega-3. It wasn't big across the world. You had to go build the market for this, and you mentioned educating the consumer. What did that look like? Were you able to be effective with that?
Margaret Hudson:
Yeah, so the interesting thing at the time I had shifted into retail sales, visiting grocery stores, doing shelf sets, working on the four Ps of marketing. And so I think for us, we weren't really big marketers in terms of putting together a big TV campaign. We probably could have at the time and would've been a lot more successful. So relied a lot on cutting it into shelf, doing in-store demos and shelf strips. And then I spent a lot of time, I was at cardiovascular conferences. I remember I was at this one conference and I was the only food company there, and I said that to my dad and he said, "Well, you're either really smart or you're really stupid," kind of thing that my dad would say, right?
Greg Schonefeld:
He probably told himself that a few times too, right?
Margaret Hudson:
But I mean, there were other food companies that came in subsequent years, connecting what you eat to your heart health and just out there trying to educate around the importance of omega-3 nutrition at the time. And that led us to be able to set up a playbook for other products.
Greg Schonefeld:
So these innovative new products with their science-backed health claims were creating real tailwinds for Burn Berry, but the diversity in their product offerings were also creating new opportunities for retailers who were struggling to introduce variety in the egg aisle.
Margaret Hudson:
When I started with Burnbrae, getting more involved with the merchandising and visiting our retailers, it was very clear we were selling 98% grade A large in chain store private label. So it was a category that really hadn't had a lot of innovation. The more conventional retailers, they like to merchandise a variety of products at a variety of price points, and they really didn't have that for eggs. And eggs at the time and still are used as a loss-leader. If you're on feature and the only thing you sell is grade A large private label, that's all you're selling. It can become a massive cost to that retailer. So by adding a bunch of different varieties into the set, they were able to insulate the core product that they were putting on feature, and so it helped to fray the cost of using eggs as a loss-leader from a merchandising perspective. So they were very open to adding innovation to these shelf sets and increasing their merchandising.
Now we've got a lot of variety, a lot of different housing systems, a lot of different sizes of eggs and trying to navigate what you're going to keep and what you're going to discontinue because the complexity becomes very costly for your supply chain. We just keep increasing the varieties at the retail shelf, whether it's different pack sizes or different types of eggs, and there really is a lot of complexity. So navigating that is something that we're trying to figure out now.
Greg Schonefeld:
It almost sounds like introducing these products changed your retailer relationship.
Margaret Hudson:
Yeah, I think that they hadn't really spent a lot of time thinking about the egg category other than how to loss-leader it. They were literally losing money on eggs because I crunched all the data for them in terms of our costs and their retails and how much they sold on deal. I think we came in almost like in a category management style role, helping them to manage the category better with more varieties and guidance on how to planogram them into the sets and how to price them at different price points. So yeah, it was bringing them a category management strategy ultimately I think is what we did, and this would've been 30 years ago, and then working with them over time to keep refining that strategy. I think it's been entrenched now for more than a decade or 20 years even. So it's nuanced now in terms of the data that we're looking at and how we're helping to refine things.
Greg Schonefeld:
So Burnbrae worked directly with retailers on how to best capitalize on their specialty offerings in the egg aisle, and that's indicative of a pattern for Burberry, not sitting back and waiting for the customers to materialize, but being proactive in generating new demand.
Margaret Hudson:
Canada net has to have people immigrate here in order for us to keep up our population. So we're very multicultural, incredible food scene and really interesting ways to prepare eggs. And through our food service team, we support a program called Dine with Eggs and different restaurateurs across Toronto and now Montreal and just inspiring them to use eggs in new ways and then us drawing inspiration for recipes or new products from these different ways that they prepare eggs and all these different restaurants. So I do believe that that is a way to take up egg consumption and to leverage this clean protein movement is to just get eggs out still in breakfast, but also in other meal occasions and for snacking.
Greg Schonefeld:
One thing striking me here is in the US, the American Egg Board takes the lead on that sort of thing. So everything you're talking about there, the American Egg Board takes the lead, but it sounds like Burnbrae's really taking the lead on that yourself.
Margaret Hudson:
I think it's definitely a company culture of loving innovation, trying new things, being brave, and just putting ourselves out there. I mean, not everything that we've launched has succeeded, but certainly most of the shell eggs have been very successful. It's tended to be a field of dreams when it comes to launching new shell eggs. If you build it, they will come. On the process product side of the business, I think consumers are a little more... They're tougher to get them to trust some of these products or to look for them to really understand them. So it's been a much harder sell to try to create businesses within the value added segment, but once they take off, they run. And I think certainly more recently, some of the innovations we've put out there in the past that maybe have struggled have been benefiting from this GLP-1 clean protein movement.
Greg Schonefeld:
Interesting. One thing you said in there, I'm thinking that's where the bravery comes in because you said it takes a bit to get them off the ground, but then they take off from there, but it takes the bravery upfront.
Margaret Hudson:
Yes. And also just being able to do the investment because you do have to invest in consumer marketing. I did my MBA and my second year assignment was I just ran the numbers on what if I did a TV campaign for liquid eggs and I took the data to my dad and then we ran a TV campaign on liquid eggs back in the late '90s. And then since then, when we're launching new products, we do put them out there with some pretty large marketing investments, which for the most part, it's helped to get categories off the ground.
And you look at other categories, you look at cereal or you look at chocolate bars or you look at soda pop and big marketing investments creating markets for these products. I just don't know the extent to which pure agricultural commodities have gone that way as brands, maybe as sectors, but not as brands.
Greg Schonefeld:
Is it easier to brand a product than it is to brand a shelled egg?
Margaret Hudson:
Yes. I think if you're creating something that's uniquely yours where you own a technology or you own a formulation, you create barriers to entry. Whereas if you're an agricultural commodity and everybody knows how to make it's very hard to hold on to any kind of brand ownership of that item. But for us, we've been trying through our innovation. We have a great origin story with our multi-generational family farm, and we genuinely care. So in terms of a lot of initiatives that we've put in place for sustainability, that's been another area that's been a huge focus for us, and our latest TV campaign was focused around some of our sustainability initiatives. We believe eggs have had a lot of, like with the cholesterol scare, so just trying to break down some of those barriers in people's minds for entering the category and all the noise that gets created, whether it's through the different sector groups or individual companies, I just think helps to contribute to the positive messaging that's helped to debunk this cholesterol myth and help to encourage people to consume more eggs across, whether it's finding a value added product that makes it easier or a type of egg that you get excited about, like more nutrition from an omega-3 shell egg.
I just think all of those different ways that you can find eggs in the grocery store or at food service encourages people to eat more eggs and has contributed to increasing egg consumption. So I think our voice has added to all the others, and that's why you're seeing egg consumption growing, which is fantastic for consumers because they're so healthy and fantastic for egg farmers.
Greg Schonefeld:
It's really interesting. This is a weird thought probably, but it just popped in my head is during that whole cholesterol period, I mean, there's maybe kind of an environment where people can make you feel like you're a cigarette company selling cigarettes, but I'm sure through that you were selling something you believed in, but you had to kind of fight against a similar perception.
Margaret Hudson:
Yeah. Well, the dieticians got out there talking to dieticians about omega-3 nutrition back in the mid '90s, and they were always dieticians, we never gave up on eggs. We always believed in eggs. And so when the folks that are going through school studying food science and human nutrition are supporting your category when everyone else is questioning it gives you that hope. It gives you that strength, that knowledge that what you're doing is right and just keep pushing and the truth will prevail. We did actually two studies back in the early 2000s with hypercholesterolemic males, guys on statin drugs with high blood cholesterol, and we did two studies. They're called controlled intervention crossover studies, and we fed them omega-3 eggs every day. They ate a minimum of two eggs a day, and their cholesterol did not increase scientifically. So I think we even had our own sort of evidence, and this was a published study, so peer reviewed published study, and it did show that their DHA phospholipid level increased and a biomarker of cardiovascular disease is how much DHA is basically in your system, the higher, the better, at least to a certain point, and it took their levels up. I mean, we had our own evidence that eating eggs was not really going to hurt you.
Greg Schonefeld:
I guess one pattern I'm seeing here is just the leadership. You're finding different ways to market at the forefront of that, doing your own studies on cholesterol, you're doing your own studies on omega-3. I hear a lot of talk that, oh, farmers just want to farm, and here you guys are, you still farm to this day, but you also do all these other things that we're talking about.
Margaret Hudson:
Yeah, I think my dad started off on the farm, but I think his interest was in farming, but also in business, and I just think it excited him. He really enjoyed growing the business, working with the retailers, doing the product innovation around the technology. When I got in there working alongside him and my brother and my brother-in-law also enjoyed that side, working with the clients, developing new products. So I think, yes, we've definitely taken an interest in all facets of it, the entire supply chain, including the sales and the marketing side of the business. I think I in particular really enjoy the innovation, so we're always trying to find new and innovative things to do with eggs.
Greg Schonefeld:
It seems like a constant shifting of a puzzle to me. Egg consumption changes, your retail position or you're adding a product and you've got production, but you've got to line up all these things to make this whole puzzle come together.
Margaret Hudson:
It's a massive complex puzzle, that is for sure. And it's like you've got limited resources, you have limited human resources and limited capital. So making those choices of where you place those investments, they're big bets. Again, you need to be brave. We're putting a large grading station, we're replacing one of our grading stations in Strathroy with another facility, and it's a lot of capital that goes into that, a lot of investment and a big bet to be able to put in all that new capacity so that we can continue to serve growing consumer demand. But it's something our family is committed to and has been committed to for decades. I'm sure we'll keep on doing it. It's a business we know, a business we love, and quite frankly, I think we're pretty good at it.
Greg Schonefeld:
In addition to meeting shifting consumer demand, Burnbrae, same as the big companies in the US, are being forced to adapt to emerging trends in egg production, including most notably the shift to cage-free.
Margaret Hudson:
There's a lot of noise around cage-free, free-run housing. When you make those investments, these investments last decades, right? So it's a very big bet for a farmer to invest in cage-free housing. Unless you're contracted for 30 years, which you will never get from a retailer, there's risk in that because it's a higher cost mode of production versus a conventional or an enriched housing system. And then as a processor or grader, if you're encouraging farmers to invest in those types of housing, how do we make sure that we keep up that demand, especially when consumers are facing economic downturn, tight grocery budgets, their grocery dollars don't go as far, they shift out of the more open housing into the lower cost items, that shift at retail is felt all the way back to the farmer. So these are all big choices that we have to make.
Greg Schonefeld:
They may be difficult decisions, but for a company as old as Burnbrae Farms that's been around since long before cage production was the norm, the decisions they make surrounding cage-free come from a place of lived experience.
Margaret Hudson:
We went into cage-free back in 1998. I had a degree in environmental science coming out of the University of Toronto, an interest in a whole bunch of things. I grew up picking eggs in cage-free barns, like these big floor barns, and then we gradually migrated into more conventional housing, and then mid- 90s, it's kind of like, well, Europe's got open housing again. So I think our dad sent Craig Hunter and our poultry guys over there, and they did some research and came back, and in 1998, we put in floor housing again, and we've been growing that ever since, basically. We still have some conventional, but been gradually shifting a lot of our production into the cage-free regime.
We went with brown bird in that system, one, because we felt consumers would probably look for a brown egg from an open housing system, but also because they were viewed as calmer, and now they've bred some of that calmness into the white layers. So the genetics following the system, I think, is something very important, and we've definitely lived that as a company and taken advantage as the technology within the birds or the housing or the graining equipment or the liquid egg processing, the hard cooking, the omelet patty cooking. As those technologies have evolved, we've tried to evolve with them. And so it's definitely been an interplay between vendors and those of us marketing and commercializing these products, and it's from farm gate to table for our business. I mean, we start with the day old chick and sell into the retailers and do everything in between. So we definitely touch the whole supply chain.
Greg Schonefeld:
It sounded to me like it all sort of starts on that marketing end. So it's the marketing end and then getting the system to work.
Margaret Hudson:
Yeah. I think for us, our father was always out there looking at new technology, bringing it back, and then it's kind of like, "Okay, we got a new machine to fill. How are we going to fill it?" You know?
Greg Schonefeld:
Mm-hmm.
Margaret Hudson:
And some of it was maybe selling more to existing customers, expanding geographically into more regions or launching new products. When we first put in our extended shelf life technology, it was basically going out to industrial clients and our food service clients. And then we launched a retail product to try to add volume to our extended shelf life technology, and over time, it's become a big part of what we sell. So sometimes it's trying to sell new products to existing clients, and sometimes it's creating something brand new for the marketplace. And not all of them are going to thrive. All those products are going to thrive, but you launch 10 and one of them will take off and it'll pay for the other nine.
Greg Schonefeld:
So that innovative spirit that drove Joe Hudson to start farming chickens at just 13 years old, well, that clearly lives on in the DNA of Burnbrae Farms, and part of what keeps Margaret driven to keep innovating and finding new ways to service their customers is a belief in the fundamental importance of the egg for human health.
Margaret Hudson:
I mean, eggs are the most nutritious food there is on the planet. I am 100% convinced of that. It's a vitamin pill enrobed and perfect protein. There's nothing healthier than an egg. I was traveling in Rwanda, and one of the goals of that country was to get one egg a day into every Rwandan child, and they were working towards that goal. I was like, "We have that luxury here in Canada and the US. We have the strong industry that makes a fantastic product, and it's very inexpensive. It's the best value in the grocery store by far in terms of the nutrition that you get for the price that you pay, and really egg consumption should just Everyone should be eating as many eggs as they can a day. I fully believe that.
Greg Schonefeld:
Burnbrae has built an end-to-end egg powerhouse. As Margaret noted, they truly touch every piece of the supply chain. And as I think through their progression, what strikes me as all the places they could have stopped. They could have remained a dairy or a regional egg company. They could have stopped at being the largest producer in Canada, and then they could have stopped after building a national network of farms, grading and processing. But they kept going. They developed new egg products, invested heavily in marketing them, funded research behind them, and even helped retailers think differently about how to manage the egg category. As Margaret noted, you have to be brave to do this with only one out of 10 products succeeding. But that bravery has certainly paid off, putting Burnbrae in a unique position as not only the largest egg producer in Canada, but position them with an entire strategy around the egg category.
And now, having covered that progression from a small backyard coop to grocery store shelves across the entire great white north, just one vital question remains.
Margaret, how do you prefer your eggs?
Margaret Hudson:
I kind of knew this one was coming because I've listened to your other podcasts. I grew up, my mom would feed me a poached egg on toast. She'd cut off part of the toast. I always ate it with her homemade Nanny Hudson's Homestyle ketchup was my grandmother's recipe. But today I actually trying to get more protein in my diet and I love making omelets. So I'll saute some vegetables. I'll put some few whole eggs, crack a few whole omega-3 eggs in there, and I add egg whites to my whole eggs to take up my protein. And it's very delicious. It's very nutritious. Get all the protein I need in my breakfast meal occasion. And I always have a little bit of my Nanny Hudson's on the side.
Greg Schonefeld:
I love it. I don't make omelets enough. I'm going to go make one now. If you enjoyed this episode, please share it with a colleague or friend. Word of mouth really helps us to grow the show. And to make sure you don't miss an episode, follow us on Spotify or Apple Podcasts. Until next time, I'm Greg Schonefeld and we'll talk to you soon.