Birds in’flu’ence Asian grain markets

Peter McMeekin, Nidera Australia origination manager, March 28, 2017


Nidera Australia, Peter McMeekin

Nidera Australia, Peter McMeekin

Hardly a week has gone by recently without another avian influenza (bird flu) outbreak somewhere in the northern hemisphere. The main region hit has been Asia with lesser outbreaks recorded in Europe and the United States (US).

One of the most interesting aspects this year has been the media’s response. It seems that the bird flu story has lost it’s newsworthiness. Such outbreaks are now common and even expected every few years as the virus mutates and new strains emerge.

The first outbreaks were recorded in Italy in 1878 and it was originally known as Fowl Plague. In 1955 it was determined an influenza virus was actually causing the disease.

It wasn’t until 1997 that Avian Influenza really hit the headlines when the highly pathogenic strain H5N1 was discovered in humans. Since that time the virus has been detected in many countries across the globe and millions of birds have died or been culled to minimise spread of the disease.

In the US more than 250,000 birds have been euthanized in the past month in the worst outbreak since 2015. The disease, first detected in Tennessee, has since been confirmed in Kentucky and Alabama.

In Japan up to 300,000 birds may have to be culled after the latest outbreak was discovered in two prefectures north of Tokyo. The plan is to bury the carcasses underground and disinfect the sheds before restocking is possible.

Across the Sea of Japan, the South Koreans were one of the first countries to report bird flu this northern winter. Around 30 million birds have been culled in a bid to control the outbreak, making it the worst so far this season. Australian eggs farmers have been one of the biggest beneficiaries as the disease has led to a shortfall of around 15 million eggs per week in South Korea, with some of that void being filled by imports from Australia.

In China, the world’s second largest poultry consumer, isolated outbreaks in a number of provinces have led to the closure of live poultry markets in a bid to prevent the spread of the disease.

What will be the impact of these outbreaks on global feed grain demand? It seems that the effect is two-fold, but minor at this stage. Firstly, we are seeing a minor redistribution of feed grain demand away from the countries affected by the outbreaks to the bigger poultry producers such as Brazil and the US.

However, these countries are also major producers of grain meaning that there may well be minor reductions in world trade of grain, especially into Asia, and an increase in the trade of the finished product as the Asian consumer looks to buy imported poultry, at the expense of the locally grown product.

Secondly, there has been some reported plateauing in the demand for poultry products across many Asian countries due to the consumer fear of contracting the disease. Whilst reports of human infection have increased compared to last year, it is certainly not close to epidemic proportions.

From an Australian and New Zealand viewpoint, domestic bird and egg producers are set to benefit. Both countries are currently disease free and well positioned geographically to replenish live bird stocks as well as satisfying increased demand for imported poultry products from the effected Asian countries.

Source: Nidera Australia 



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