New U.S. HPAI reports spark bans, hit stock prices
Story Date: 3/7/2017

 

Source: Chris Scott, MEATINGPLACE, 3/6/17


Confirmation of an outbreak of highly pathogenic avian influenza (HPAI) in Tennessee has prompted three Asian countries to impose bans on chicken from the Volunteer State, according to several media reports.


About 73,500 birds will be culled on a chicken breeder farm contracted to Tyson Foods Inc. in the first case of HPAI in the United States this year, according to USDA reports. Tyson released a statement that it is working with state and federal officials to prevent the H7 virus from spreading. About 30 other farms in the area have been placed under quarantine as tests on those birds continue.


Government officials in Hong Kong, Korea and Taiwan all announced bans on the import of poultry from Tennessee as well as from Wisconsin, where low pathogenic H5N8 bird flu also has been confirmed. Hong Kong imported about 300,000 metric tons of frozen and chilled poultry meat and 526 million eggs from U.S. farms in 2016, according to a report in 7th Space Interactive.
Meanwhile, the agriculture ministry in South Korea launched its ban today, although heat-treated chicken meat and egg products still can be imported, according to Reuters. Korea resumed U.S. poultry imports in June 2016 after the bird flu outbreaks the previous year were confirmed as having ended.


Finally, the council of Agriculture in Taiwan imposed its ban on any U.S. poultry from Tennessee while only poultry meat from Wisconsin is being banned because of the strain is H5 instead of H7, according to Focus Taiwan. Birds or poultry products already loaded on ships or planes heading to Taiwan also are exempt from the Mar. 6 ban.


Wall Street reacts
Wall Street may be remembering the impact of the 2015 U.S. bird flu outbreaks that killed 48 million birds before it ended; shares for four publicly traded major poultry companies we all down in mid-morning trading. Tyson Foods was down nearly 3.5 percent, Sanderson Farms was off by nearly 3 percent and Pilgrim’s Pride Corp. stock was off by more than 1 percent.


Stephens Inc. analyst Farha Aslam noted in a report that Tennessee represents between 2 percent and 3 percent of total U.S. poultry production, limiting the impacts of the latest overseas bans. She cautioned that while the source of the outbreak is still unclear, enhanced biosecurity measures in place since the 2015 outbreaks should help contain additional outbreaks.


Biosecurity tightened
Wayne Farms told Meatingplace in a statement that it is elevating its biosecurity measures at its farms in northern Alabama as a precaution, adding that none of its facilities are in the six-mile quarantine zone established in Tennessee. The company’s nearest flock is more than 35 miles from the affected farm, which does not produce poultry for Oakwood, Ga.-based Wayne Farms.


“Wayne Farms remains confident that its products are completely safe for consumers,” the statement added. ”The company will continue to monitor the situation from both a quality assurance and logistical perspective and continue its adherence to the highest safety and security standards.”

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