Monday, February 11, 2019

Foreign animal disease outbreak would devastate pork industry


An outbreak of a foreign animal disease would devastate the United States pork industry because exports would immediately be cut off, economists warn in a new report.

The impact would be even greater in Canada where 70 per cent of pork is exported.

Longer-term an outbreak “would batter pig farmers and related allied industries, slash tens of thousands of jobs, lead to substantial costs for state and federal governments and — as a result of declining pork prices — have a deleterious effect on the rest of the agricultural sector, the experts say.

It could take years to restore export markets which currently account for 26per cent of U.S. pork production.  On the domestic front, pork prices would ultimately drop dramatically, the experts added.

Estimates of the financial impact for each of the three trade-limiting diseases — foot-and-mouth disease (FMD), classical swine fever (CSF) and African swine fever (ASF) — are in the billions per year, according to researchers such as Dr. Dermot Hayes,  an agricultural economist at Iowa State University.

Hayes led a recent study that estimated U.S. pork and beef industries would lose about $12.9 billion a year in exports if there were an outbreak of foot and mouth disease.

The study also projected a decline in corn prices by about 20 cents per bushel and soybeans by 60 cents per bushel.
Looking specifically at swine diseases, Hayes estimated that in the first year of an outbreak of African Swine Fever, revenue losses would be $8 billion for pork, $4 billion for corn and $1.5 billion for soybeans.

Under the study’s Classical Swine Fever scenario, pork prices could drop 45 per cent while corn prices could decline by about 10 cents per bushel and soybean prices by 50 cents per bushel. Hayes and his team of researchers attributed the projected soybean losses to the amount of soybean meal used in the hog industry.

Another FMD study, led by Dr. Ted Schroeder, an agricultural economist at Kansas State University, projected a 95 per cent drop in all U.S. red-meat exports — including lamb, as well as live animals — for at least three months after authorities have cleared the last FMD case.2

In addition, there would be other assorted costs such as industry response, disease containment and elimination, and animal euthanasia or disposal, said Patrick Webb, DVM, director of swine health programs, National Pork Board (NPB).
“We’re talking billions and billions of dollars of lost revenue just from one case being reported,” Webb told Pig Health Today. “It would take an extremely hard hit on the agricultural economy, across all sectors because the agricultural economy and our communities are so tied together. If one sector is hurting because of a disease issue, it usually ends up hurting others.”

Ultimately, a sustained FAD outbreak could cost the US agricultural sector about $200 billion over 10 years, according to estimates by Schroeder and Hayes.