Here is what will happen: out of state egg producers will ultimately abandon the CA market. The capital cost associated with complying with the law will be too much or will take too long.
So what is the future of CA egg farmers? It doesn't look good. Here is a pro-hen report that describes what happened in Europe:
While the shrinking egg market can be positive in terms of the number of hens who suffer, as noted earlier, those who went out of business altogether were small- or medium-scale farmers who could not afford the facility investment. Large companies made the transition, and this can be negative for animal welfare reform in the long term. As discussed above, mass egg production is associated with the fundamental problem of hen welfare because it is almost impossible to induce natural behaviors in hens if thousands of hens are put together. Considering the scale of the factory farming and the level of animal welfare, a much smaller scale farming system is needed to produce eggs humanely when society is ready for much better animal welfare by reducing its egg consumption dramatically. However, if the phenomenon of smaller farmer bankruptcy continues, there will be no farmers who can take a role to provide humane egg production by the time the society can function with smaller scale farmers and no longer needs industrialized farming.Fewer producers mean higher egg costs. And that's not even accounting for the new rules that will raise the prices of eggs to pay for the new infrastructure.
And those that are outside CA? What if they don't want to comply with CA's new laws? Oh, that's easy. They will expand more into egg exports into other countries such as Mexico and Canada.
For table eggs, exports in 2012 were 127.6 million dozen valued at $122.6 million, up 54 and 59%, respectively, both records, and driven by increased shipments to Mexico, Hong Kong, and the European Union.So, in the end we could find ourselves egg-poor since they will all be sent overseas....
The top five export markets for table eggs are Hong Kong, 46.7 million dozen, up 30%; Canada, 26.1 million dozen, up 19%; Mexico, 16.6 million dozen vs. 1.3 million dozen in 2011; the UAE, 13 million dozen, up 66%; and the EU, 8.9 million dozen vs. 0.78 million dozen in 2011.
For egg products, 2012 was also a record-setting year, as total export value rose by 20% to $141 million.