Bird flu redirects trade flow of U.S. chicken, eggs, grains

Reuters
April 17, 2017
By Reuters
April 17, 2017, Chicago, IL - Global outbreaks of bird flu in poultry have altered the flow of U.S. chicken meat, eggs and grain around the world, adding to challenges faced by domestic exporters and giving a leg up to Brazil, which has so far escaped the disease.

Different strains of avian flu have been detected across Asia, Europe, Africa and in the U.S. in recent months, leading to the culling of millions of birds and a flurry of import restrictions on eggs and chicken meat.

U.S. grain traders such as Bunge and Cargill have lost business because poultry deaths have reduced feed demand. Some domestic poultry producers, though, have managed to boost sales by taking advantage of trading bans that hurt rivals.

Sanderson Farms, the third-largest U.S. poultry producer, said it sold more chicken to Iraq when Baghdad backed away from Europe’s poultry due to bird flu, or avian influenza (AI), in the bloc.

Iraq imported 84.2 million kg of U.S. chicken meat last year, about three per cent of total U.S. chicken meat exports.

Data on chicken exports is not yet available for March, when the U.S. confirmed its first case of a highly lethal form of bird flu in commercial poultry in more than a year.

After the finding, South Korea, suffering its own worst-ever outbreak of bird flu, blocked U.S. poultry and eggs. That shut off opportunities for U.S. exporters hoping to make sales to cover shortfalls in South Korea, said Keithly Jones, a senior economist for the U.S. Department of Agriculture (USDA).

Last month, USDA cut its forecast for 2017 U.S. egg exports by six per cent to 305 million dozen because of South Korea’s ban.

U.S. grain traders, who were grappling with a global supply glut before flocks in other countries were culled to contain bird flu, have faced lower demand for the corn and soybeans that provide feed for chickens.

Bunge, one of the world’s top grain and oilseed traders, told Reuters that shipments to South Korea for February and March declined “on the back of reduced feed productions.” Shipments have since been picking up, according to the company.

In March, Cargill said South Korea’s outbreak, in which about 35 million birds have been culled, contributed to a decrease in quarterly earnings in its global animal nutrition unit. READ MORE

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