How Big Will Grain Losses from Avian Flu Be?

The current bird flu outbreak in the U.S. has so far outpaced the previous record outbreak in 1983 by 30 million birds, with 47 million birds being lost after 222 confirmed cases having been documented across 15 states. Multiple industries have been disrupted including turkey production, egg production, and potentially, the broiler industry this fall – but how does this translate to grain industry losses?

Conservative estimates are that for every bird lost, one bushel of corn goes unused, meaning that the outbreak could result in a loss of the use of 50 million bushels of corn this year. But if factoring in a possible consumption of more than 1 bushel of corn per bird, plus a slow rate of flock repopulation, grain market losses could top 100 million bushels.

Despite these figures, estimated poultry residual use of corn of 1.8 billion bushels has not been revised downward in the U.S. Department of Agriculture (USDA) ERS Feed Grains Yearbook, due to the industry segments that the flu has hit, and strong agency efforts at rapid repopulation.

However, this is not a precise science, and feed and residual uses can vary widely year to year, and can be closely correlated to crop size. Third quarter stocks will be reported in the USDA’s June 30 report, which may include downward expectations for feed corn use in 2014/15.