WASHINGTON, July 29, 2015 – With the poultry industry bracing for another outbreak of the avian flu this fall, there’s a simmering disagreement over whether producers should vaccinate birds. Broiler producers, who are far more dependent on exports than the egg and turkey farmers who bore the brunt of this spring’s outbreak, are worried that using the vaccine could result in more export bans.

The United States itself doesn’t allow imports of poultry products from a country where birds are being vaccinated for avian influenza, the National Chicken Council pointed out in comments filed in May to USDA’s Animal and Plant Health Inspection Service.

Agriculture Secretary Tom Vilsack told the House Agriculture Committee last week that the vaccine has proven 100 percent effective in chickens. To address concerns in the U.S. industry, the administration is trying to persuade foreign markets not to impose nationwide bans on U.S. poultry but to only target affected regions. That refers to the Midwest, where there is the greatest interest in using the vaccine. A USDA spokeswoman says no decisions have been made yet about whether to use the vaccine, much less where.

But if the vaccine does get used, Mexico is the industry’s biggest concern, since it is the largest export market. The ranking Democrat on House Agriculture, Collin Peterson, urged U.S. Trade Representative Michael Froman to use this week’s Trans-Pacific Partnership negotiations in Hawaii to press Mexico on the idea of regionally targeted restrictions.

The broiler industry last year exported 7.3 billion pounds of chicken, 19 percent of the industry’s total production, but shipments are expected to fall under 6.9 billion this year. Eighteen countries, including China, Russia and South Africa have banned all poultry products from the U.S. and 31 have banned poultry from infected areas, according to the National Association of Egg Farmers.

The Chicken Council said in its comments to APHIS that there was a “strong likelihood” that use of the vaccination would lead to new trade restrictions and could even disrupt domestic shipments. Domestic trade has similarly high potential to be adversely affected by a vaccination program. Due to the highly virulent nature of the virus, and the unknown efficacy of the vaccine, it is likely that trade between states will become increasingly complicated.”

Consumers are benefitting from the export restrictions so far. Turkey prices increased just 0.1 percent from May to June, and while chicken prices rose 1.7 percent in that period, they are expected to increase 2.5 percent to 3.5 percent for the year, according to USDA’s Economic Research Service. “As countries institute bans or partial bans on U.S. poultry exports, the result is that more chicken broilers are left on the U.S. market, placing downward pressure on retail chicken prices, ERS said.  Eggs are another matter. Egg prices soared by 17.8 percent from May to June, the largest month-over-month increase in 42 years. Egg prices are nearly 22 percent higher than they were a year ago. ERS forecasts that egg prices will wind up 12.5 to 13.5 percent higher in 2015 than they were in 2014.


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