HPAI Outbreak's Impact on US Poultry and Dairy Sectors in 2024

Published May 24, 2024
The HPAI outbreak in the US has severely impacted the poultry and livestock industry. Confirmed in Feb-22, the disease has since affected approximately 90.85 million poultry so far. This outbreak has kept egg and chicken meat prices high, reflecting significant increases since Feb-22. Supply chain disruptions due to avian influenza have exacerbated these price hikes, further pressured by increased demand during economic crises and heightened health consciousness. The HPAI outbreak has also spread to dairy cows, with the CDC reporting cases in 52 dairy herds across nine states as of May 22, 2024. This situation has led to trade restrictions and heightened testing protocols for US livestock exports, notably by Colombia, Canada, and Mexico. To mitigate HPAI spread, the USDA implemented transportation restrictions and testing obligations, and announced nearly USD 200 million in federal assistance. The ongoing situation underscores the need for global cooperation to develop an avian influenza vaccine. Looking ahead, egg and chicken prices are expected to remain high, while dairy product prices are unlikely to be significantly affected since pasteurization appears to eliminate the HPAI virus.

The outbreak of highly pathogenic avian influenza (HPAI) of variant H5N1 in the United States (US) has severely impacted the poultry and livestock industry. The United States Department of Agriculture’s (USDA) Animal and Plant Health Inspection Service (APHIS) confirmed the first case on February 8, 2022, in a commercial flock in Dubois County, Indiana, affecting 29 thousand birds. Since then, APHIS data indicates that HPAI has affected approximately 90.85 million poultry and 9.35 thousand wild birds, with 37.49 thousand birds affected in the first 20 days of May-24.

Figure 1: The Number of Poultry Affected by HPAI from 2022 to 2024 in the US

Source: APHIS

The HPAI outbreak in the US has created uncertainty in the poultry industry, keeping egg and chicken meat prices elevated. According to the US Bureau of Labor Statistics, the average price of chicken breast was USD 4.06 per pound (lb) in Apr-24, a slight 1.22% month-on-month (MoM) drop but a 6.28% increase compared to Feb-22. Similarly, the average price of grade A, large chicken eggs was USD 2.86 per dozen in Apr-24, a 4.35% MoM drop but a substantial 42.29% rise from Feb-22. Chicken and egg prices reached record highs of USD 4.75/lb and USD 4.82/dozen in Sep-22 and Jan-23, respectively, before easing as HPAI cases decreased, with zero incidents reported in Jun-23, according to APHIS data. However, egg prices began to rise again as HPAI resurged in Jul-23.

Figure 2: Egg and Chicken Breast Price Trends from 2020 to 2024 in the US

Source: US Bureau of Labor Statistics

The price increases for chicken and eggs in the US are attributed to disruptions in the supply chain caused by avian influenza. As a biosafety measure, infected poultry are culled to prevent the disease's spread. For instance, the Texas Department of Agriculture reported that Cal-Maine Foods, one of Texas's largest poultry farms, was expected to cull approximately 1.6 million hens and 227 thousand chicks in early Apr-24 due to positive avian influenza tests, representing about 4% of its flock. This situation raised concerns about the industry's ability to meet demand amidst the outbreak, with a high likelihood of further price increases if production fails to keep pace due to avian flu-related challenges.

In addition to the HPAI outbreak, the rise in chicken and egg prices can also be attributed to increased demand during the economic crisis following the COVID-19 pandemic and geopolitical tensions such as the Russia-Ukraine war. During these periods, many consumers opted for cheaper products due to economic constraints, favoring chicken and eggs over beef and pork. Furthermore, as global health consciousness grows, more consumers are choosing chicken and eggs, which are considered healthier options than beef and pork, thereby driving up demand.

The Spread of HPAI to Dairy Cows and its Implications

The HPAI outbreak has not only impacted poultry but also dairy cows in the US. The Centers for Disease Control and Prevention (CDC) reported a multi-state outbreak of HPAI in dairy cows on March 25, 2024, marking the first instance of these bird flu viruses being found in cows. As of May 22, 2024, the CDC indicates that approximately 52 dairy herds across nine states - Colorado, South Dakota, Kansas, Michigan, North Carolina, Idaho, Texas, Ohio, and New Mexico - have been affected.

In response to the concerns surrounding the spread of HPAI, numerous studies are being conducted by various institutions, including the USDA, CDC, and several universities and institutions. For instance, the US Food and Drug Administration (FDA) reported on May 20, 2024, that approximately 20% of retail milk samples collected between April 18 and 22 across 17 states contained remnants of the H5N1 virus, suggesting the outbreak's widespread nature. Fortunately, the FDA confirmed that pasteurized milk is safe to drink but cautioned against consuming raw milk. Additionally, hamburgers, a popular fast food in the US, were tested for H5N1 infection because the minced meat used in hamburger patties typically comes from older animals, which have shown cases of the disease. The results indicated that properly prepared ground beef patties, cooked medium to well-done, do not contain the infection. Notably, this is the first time that dairy cows have been known to contract bird flu, which typically affects poultry.

The spread of HPAI to dairy cows in the US has impacted its trade with other countries. For example, Colombia restricted the import of beef and beef products from US states where dairy cows tested positive for avian influenza as of April 15, 2024. Additionally, the Canadian Food Inspection Agency (CFIA) updated its import requirements for US breeding cattle due to the H5N1 outbreak. Effective April 29, 2024, these new measures include requiring negative HPAI test results for lactating dairy cattle, milk testing at the retail level for viral fragments of HPAI, and voluntary testing for cows without clinical signs of the virus. Mexico has also implemented preventative measures to increase surveillance and reinforce inspections of US livestock imports following the detection of avian influenza in dairy cattle.

To reduce the transmission of the virus in cattle, the USDA implemented transportation restrictions and testing obligations on April 29, 2024, requiring lactating dairy cows to test negative before being shipped across state lines. In addition, the USDA and the Department of Health and Human Services (HHS) announced federal assistance totaling nearly USD 200 million to help producers mitigate H5N1. Michigan State University (MSU) has also committed USD 168 thousand to research the effects of HPAI outbreaks on dairy cattle reproduction and milk production, as well as the transmission of the disease.

In conclusion, the avian influenza outbreak has devastated the global poultry industry for years, with cases recorded in Cambodia, the Philippines, India, China, Australia, and the US in 2024, leading to elevated egg prices. The recent spread of HPAI to dairy cows in the US underscores the urgent need for an in-depth scientific response to understand transmission and prevent future occurrences. This situation highlights the necessity for global cooperation in developing an avian influenza vaccine to protect the poultry and livestock industries from a potential pandemic. Consequently, egg and chicken prices are expected to remain high in the coming months, while dairy product prices are unlikely to be significantly affected since pasteurization appears to eliminate the HPAI virus.

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