Sunny Queen and 11 other egg producers and suppliers are alleged to have breached competition laws by coordinating on production and supply of eggs in Australia.

The ACCC has filed civil proceedings against the companies in the Federal Court.

The proceedings involve allegations against entities including Sunny Queen, Doug Hall Poultry, McLean Farms, Ellerslie Free Range Farms and Kinross Farm.

It’s alleged that since “at least” October 2020 key egg suppliers and producers coordinated on a range of business decisions including production volumes, distribution, expansion plans and culling to manage perceived oversupply. The ACCC says this was done in a way that “likely substantially reduced competition for many years”.

ACCC Chair Gina Cass-Gottlieb says the organisation’s investigation has uncovered alleged widespread anti-competitive conduct in the egg industry that it alleges has impacted the supply of eggs to Australian consumers since at least 2020.

“This alleged conduct is extremely serious, which is why we have commenced this Federal Court action,” she says.

“Fair competition in the supply of fresh food such as eggs is extremely important. Anti-competitive conduct disadvantages Australian consumers, who can face reduced choice and higher prices, as well as those businesses seeking to compete fairly or who are seeking to enter markets to provide competing supply.

“These companies are alleged to have coordinated in a range of decisions about their business operations, including the retailers each business could supply, what volumes they could produce and when to cull birds to manage periods of perceived over-supply.

“We allege this coordination between Sunny Queen, Hall and McLean Farms extended to purchasing a property in Pittsworth, Queensland, for the purpose of preventing its acquisition by rival egg suppliers. We also allege this had the effect of substantially lessening competition.

“We also allege that Sunny Queen restricted how many eggs its rival Kinross could sell to customers, and prevented Kinross from selling its eggs to Coles, Woolworths, ALDI, Metcash or Costco.”

The case includes concerted practice allegations. This is the first case brought by the ACCC to include concerted practice allegations since the prohibition was introduced in 2017. A concerted practice involves cooperation between businesses that goes beyond them acting independently in response to market conditions.

The ACCC is seeking declarations, penalties, injunctions, costs and other orders.