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USDA-APHIS evaluating poultry indemnity calculator

The USDA is evaluating how it calculates the value of poultry in its indemnity program.

Incoming deputy chief economist Dr. Warren Preston says in the wake of the avian influenza outbreak last year, finding a fair price for lost birds proved to be quite challenging.

“We don’t have market prices for the animals.  With a turkey we have meat prices, but for a live bird price; that’s not available.  And for egg layers, there just aren’t really any transaction prices available.”

He tells Brownfield there is a federal law stating that the Ag Secretary shall compensate producers for the fair market value of any animals destroyed, and USDA’s Animal and Plant Health Inspection Service has been assessing its indemnity calculator to see if appropriate values are being formulated.

Preston says with turkeys it’s fairly straightforward using current meat prices, but for layers the calculations are more complicated.

“You can obviously look at historical egg prices and historical data on the cost of production.  But how does that translate back into the value of the bird?  We’ve been involved in some discussions with the industry, because they have raised questions about the calculations.”

An estimated 500 million birds were affected by the avian flu outbreak in 2015 and Preston says total indemnity payments totaled nearly $270 million dollars.