U.S. exports at risk as bird flu enters heart of poultry country
By Tom Polansek and P.J. Huffstutter
CHICAGO, March 12 (Reuters) - A case of bird flu confirmed Wednesday in the heart of America's poultry region, is certain to mean more export restrictions, increasing U.S. supply and likely forcing the world's biggest poultry companies to trim prices.
The U.S. government announced the infection of highly pathogenic H5N2 avian flu in turkeys in Arkansas -- home to Tyson Foods Inc, the world's biggest chicken company. The virus is unlikely to kill enough U.S. birds to offset the drop in overseas demand, however.
There will be "more product on the domestic market and that will depress prices," said Jessica Sampson, agricultural economist at Livestock Marketing Information Center.
Shares in producers Tyson, Pilgrim's Pride Corp and Sanderson Farms Inc tumbled on Wednesday, with Tyson's stock price hitting its lowest point in five months and the stock price for JBS SA unit Pilgrim's Pride dropping as much as 9 percent.
The USA Poultry & Egg Export Council said it expects 30 to 40 additional countries to impose new trade restrictions on U.S. poultry and eggs in the $5.7 billion export market. Additional limits could come from Mexico, the top U.S. chicken importer, which already is blocking poultry imports from Minnesota, Missouri and California due to bird flu, the trade group said.
Previous cases of avian flu in other states triggered China and South Korea to recently impose bans, still in effect, on U.S. poultry imports. Last year, they accounted for about $428.5 million in export sales of poultry meat and products, according to U.S. Department of Agriculture data.
Other countries have banned exports from only states or counties with positive cases of avian flu.
With the export market already hit by the strong dollar, "we don't need anything else that would make those exports any softer," said Mike Cockrell, chief financial officer for Sanderson Farms. Continuación...