Avian flu impact on farmers, ag economy

The deadly H5N2 virus, or avian flu virus (bird flu), was first detected in Minnesota in early March, but is now having an ever-increasing negative economic impact on Minnesota, Iowa, Wisconsin, and other Midwestern states. As of this past weekend, Minnesota has 49 cases of avian flu confirmed in 17 counties, with a high concentration of confirmed bird flu cases in 5 or 6 counties in central Minnesota. In addition, the largest egg laying operation in Iowa has been confirmed with having the avian flu virus, as have some poultry operations in Wisconsin and South Dakota.

Once the avian flu virus is confirmed, all birds on the farm are destroyed. Thus far Minnesota turkey producers have lost approximately 3 million birds that were either killed directly by the virus, or were euthanized following confirmation of the virus. This represents about 7% of state’s turkey production. Minnesota is the number one turkey-producing state in the U.S., producing approximately 20% of the nation’s turkeys. Iowa ranks first in the U.S. in egg production, and the largest flock in Iowa was hit with the H5N2 virus, resulting in a loss of 3.8 million laying hens. Egg laying operations in Minnesota and Wisconsin have also been impacted by bird flu.

Late last week, Minnesota Governor Mark Dayton declared a state of emergency relative to the avian flu outbreak in Minnesota. This declaration activates a coordinated effort among various state agencies to respond to H5N2 virus, and if necessary, allows for the calling-up the National Guard to address local issues relative to controlling the spread of the virus. State officials in Minnesota, Iowa, Wisconsin and other states have been working closely with USDA officials to trace the causes of the avian flu virus and the rapid spread of the disease, as well as looking for ways to manage and control the disease. Officials believe that the disease was spread by migratory birds, as they moved north this spring. Some officials also think the bird flu virus may be airborne, and could have been spread from farm-to-farm by some of the strong winds in recent weeks.

The biggest financial impact from the avian flu outbreak definitely affects the poultry producers that are directly impacted by bird flu. There is no compensation to producers for birds that die from the virus; however, they are compensated partially by USDA for birds that are euthanized. Another economic loss to producers will be the lost production while the operation is closed down, as the barns are being cleaned and disinfected before production is allowed to resume, which could take 4-8 weeks. Minnesota is also a major turkey-processing state, with several processing plants in operation, which also could be impacted by the reduction in turkey production. All of this will likely have an overall negative economic impact on cities and communities, especially in the hardest hit counties in central Minnesota.

Another negative economic impact on Minnesota’s turkey and poultry industry will be the fact that several countries have closed export markets to poultry products from Minnesota and other states as a result of the avian flu outbreak. Approximately 20% of the poultry products in the U.S. are exported to other countries. This also may put more poultry products into U.S. retail outlets, which could lower potentially lower retail prices, at least on a short-term basis. It is too early to determine if the avian flu virus, or changes in export shipments, will have any impact on U.S. pork or beef prices in the coming months. Poultry production operations utilize a considerable amount of corn and soybean meal as a feed source; however, at this point, the lost poultry production is probably not large enough to have a significant impact on corn and soybean market prices.

 

USDA and State officials have been consistent in saying that there is very little risk to humans from the H5N2 virus. They also have re-enforced the fact that turkey, eggs, and other retail poultry products are completely safe to eat, and that the virus poses no risk to the U.S. food supply. Thus far, there has been very little impact from avian flu on the retail poultry and egg market in the U.S. As production losses increase, and supply chains in some areas of the U.S. are affected, this situation may change.

Many large poultry farms already had strong biosecurity programs in place prior to the outbreak of the highly contagious H5N2 virus; however, USDA is now encouraging poultry operations of all sizes to review and, if necessary, step-up biosecurity efforts on their farms. Biosecurity measures include restrictions on people and vehicles entering poultry farms or facilities, using known feed and water sources, and good sanitation procedures for employees and others that enter poultry facilities. These are similar to recommended biosecurity measures that are utilized by most commercial swine operations in the Midwest.

Most experts expect the H5N2 virus to continue for a few more weeks, and then begin to subside once we have more sunshine and warmer outside temperatures on a consistent basis. There is still considerable uncertainty regarding the rapid spread of the bird flu virus, and the potential return of a serious avian flu outbreak next fall, when temperatures cool, and migratory birds begin the fly south. USDA and private companies are working on potential vaccines to fight against the bird flu virus; however, commercial availability of a vaccine is likely still several months away.

The avian flu virus can also affect smaller, backyard type poultry flocks, as well as the large commercial poultry farms. In fact, there have already been confirmed cases of bird flu on the smaller-type poultry farms. State officials are monitoring potential spread of the H5N2 virus in smaller poultry flocks very closely, in order to determine if this could impact poultry exhibits at county fairs or the Minnesota State Fair later this Summer. Officials at zoos and other public venues that feature live poultry or bird exhibits are also keeping a very close eye the bird flu situation, and taking necessary precautions.

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