News

Assessing the global avian influenza impact

Rabobank issued its Poultry Quarterly report for Q2 this week.  The assessment takes a look at the global poultry market and the impact avian influenza is having on the market.  Animal Protein analyst Will Sawyer says trade bans and barriers are having as much of an influence on the market as the virus itself.  Some countries have banned poultry products from the entire United States while some have banned shipments only from those states with confirmed infections.  Sawyer notes poultry exports to those banning only from affected states have not declined and in some cases even increased.

While AI has had a major impact on U.S. egg production taking some 35 percent of production off the market, the impact on poultry meat is much less significant.  Sawyer says the except for one infection in Arkansas, the virus has not been found in the major broiler states like Georgia and the Carolinas.  Right now the infections have been limited to the Pacific and Mississippi flyways; that could change in the fall when it is expected infections will increase as the weather cools and the migratory birds start moving again.  Sawyer says there is the strong possibility that infected birds from the two flyways will comingle with birds from the Atlantic flyway at that time bringing the virus to the Southeast.

As for U.S. egg production, Sawyer says imports will be able to fill some of the void but the bigger factor will be how quickly the U.S. producers recover.  He notes the quick action by the USDA in dealing with infections, delivering indemnity payments for losses and the high price of eggs will encourage rapid recovery.  One drawback might be a resurgence of the virus as they rebuild this fall.

Globally, Rabobank is urging governments to follow international guidelines when dealing with avian influenza restrictions and regulations.

Sawyer talks about the market:

Read more from Rabobank here: