Behind a row of sealed red incubator doors in a new facility in northern China, about 400,000 chicks are hatched every day, part of the rapidly modernizing supply chain in China’s US$37-billion egg industry, the world’s biggest. As China overhauls production of everything from pork to milk and vegetables, farmers raising hens for eggs are also shifting from backyards to factory farms, where modern standardized processes are expected to raise quality and safety. That’s an important step in a country where melamine-tainted eggs and eggs with high antibiotic residues have featured in a series of food safety scandals in recent years. It is also spurring demand for higher-priced branded eggs over those sold loose in fresh produce markets. “These days if you’re a small farmer, your eggs won’t get into the supermarkets,” said Yuan Song, analyst with China-America Commodity Data Analytics. Tough new regulations on treating manure and reducing the environmental impact from farms have also pushed many small farmers out. Most egg producers now have between 20,000 and 50,000 hens, said Yuan, a significant change even from two years ago. The remainder with less than 10,000 birds are likely ...