Tyson loses another breeder farm flock to bird flu, concerns in Tennessee and Alabama rise

A second farm in Tennessee contracted for Tyson Foods’ breeder stock has tested positive for Avian Influenza.

Late last week state officials and Tyson Foods said they had began to cull a flock of 55,000 breeder hens that tested positive for the highly pathogenic H7N9 strain of Avian flu. The breeder farm is located in Lincoln County, Tenn., about two miles from the Tyson flock of 73,500 birds first infected by the same strain in early March.

The most recent farm was located within the quarantine zone which raises concerns for how the strain got from one farm to the other. There was a third case – a low pathogenic strain – found in an adjacent county in Tennessee, not connected to Tyson Foods, according the Tennessee Department of Agriculture.

Tyson Foods said it continues to work with state and federal authorities to quickly euthanize the affected flocks. The meat giant said it does not expect disruptions to its chicken supply given it has a diversified operation scaled across several states.

That said, Tyson has lost about 129,000 breeders, the parent stock responsible for laying the eggs containing broiler chicks which are collected and taken to a hatchery. Once hatched these broiler chicken are transported to grow out farms and later slaughtered for chicken meat. This disruption in Tyson’s supply chain warrants monitoring given it could reduce broiler supply for a longer time in the complex which supplies the chicken processing plant located in Shelbyville, Tenn., which largely serves retail.

Tyson reminds consumers that Avian Influenza poses no risk to food safety, nor human health as it is a bird health issue. Tyson also emphasized in its release that it continues to operate under heightened biosecurity as a result of the outbreaks that impacted the poultry industry in 2015.

Officials in Alabama have reported three cases of bird flu in Jackson, Lauderdale and Madison counties all bordering Tennessee. One of those was a backyard flock, but the other two were commercial operations. Alabama officials have not named the company connected to the commercial farms. But officials are concerned given that the poultry industry in Alabama is a $15 billion business.

Tyson Foods operates a chicken plant in Albertville, Ala., located in Marshal County, which borders Jackson and Madison counties.

Federal farm officials are on heightened concern given that six cases with various strains in fairly close proximity have been diagnosed this month. While Tyson may be able to mitigate the losses, it does complicate exports with trading partners such as South Korea and Japan that have already limited imports related to the first case in Tennessee.

Bird flu is spread via wild migratory birds that carry the disease without showing signs of sickness. The last wide spread outbreak in the U.S. of a highly pathogenic strain occurred in 2014 and 2015 resulting in the loss of roughly 50 million birds, mostly laying hens for the egg industry.

Tyson Foods shares (NYSE: TSN) rebounded a bit on Monday closing at $62.36, up 55 cents. The stock has has a rough month with shares tumbling almost $3 in value since Feb. 17. For the past 52-weeks the share price has ranged from a $77.05 high to a $55.72 low.