Bird Flu Hits Brazil, World's Top Chicken Exporter, for the First Time Ever

The virus that’s ravaged poultry flocks in the U.S. and Europe has just hit Brazil, the world’s largest chicken exporter, for the first time ever. 

Avian influenza, aka “Bird Flu”, was first detected in two wild birds on the coast of Espirito Santo, a state in the nation’s southeast, according to a statement from Brazil’s Agriculture Ministry. The country is home to some of the world’s biggest poultry producers including BRF SA and JBS SA. Shares of both companies declined after discovering the highly pathogenic disease in some flocks.

The recent surge in U.S. egg prices was largely due to the worst-ever global bird flu outbreak that’s devastated hen flocks. If the disease spreads in Brazil’s commercial poultry flocks, chicken prices could follow suit. Exports from the South American nation have jumped to records as the country filled the supply gap left by other producers that were hit by the flu. 

Brazil’s Agriculture Minister Carlos Favaro declared a state of emergency alert to increase mobilization efforts from poultry producers and the official veterinary service, but has thus far not banned poultry shipments. 

EDITOR’S TAKE:

Just when we thought this nasty Bird Flu epidemic was under control, it now rears its ugly head in Brazil. Although the U.S. poultry flock has largely been rebuilt and can take up any slack from the Brazilian episode, the outbreak in that nation will likely reduce supplies and cause prices to once again spike at the consumer level, depending on the severity of their outbreak. Hopefully it can be contained, but if the recent U.S. experience is any indication we might be in for a longer episode. The good news is that U.S. poultry producers could see a significant improvement in their net incomes assuming the Bird Flu does not show up here any time soon. Make sure to follow this outbreak news in future editions of the AIR.