Chicken Prices May Rise as Avian Flu Spreads

Mon, 07 Aug 2017

SOUTH AFRICA - Poultry producers on the JSE have proven to be resilient in the midst of the avian influenza outbreak, but experts warned that if the disease continued to spread South Africans could expect shortages of chicken and prices to rise.

According to BusinessReport, the share prices of these companies have gained during this period.

Astral Foods, the most affected by the outbreak, has seen its share price gaining about 14.58 per cent since the outbreak was reported towards the end of June. The stock traded at R148 a share on the day of the outbreak and by Friday the share price was trading around the R155 level.

Astral reported an outbreak in one of its poultry breeding farms in Villiers. Despite extreme measures taken to reduce the risk of any further infections on any other Astral farms, the second outbreak of highly pathogenic avian influenza H5N8 had been isolated and confirmed on 1 August on a poultry breeding facility called Welbedacht, outside Standerton in Mpumalanga. This new outbreak was completely unrelated to the Villiers incident.

"The spread of the infection to all poultry sheds on the Villiers farm was successfully prevented, and although that farm remains under quarantine no further sign of the disease has been detected amongst the remaining poultry stock on that farm," the group said.

Three more poultry producers also saw their share prices climbing after the outbreak was reported. Pioneer Foods has been risen 3.99 per cent, Sovereign Food up 14.96 per cent and Quantum Foods up 2.95 per cent.

David Wolpert, the chief executive at the Association of Meat Importers and Exporters of South Africa, said if the outbreak continued to spread, then South Africa could expect shortages of chicken, as well as price increases that might be steep.

Further Reading

You can visit the Avian Flu page by clicking here.