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Avian flu could cause economic losses of R$21bn in Brazil

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An eventual large-scale outbreak of avian influenza to industrial poultry farms in Brazil could have an annual impact of R$21.7 billion on the world’s largest exporter of chicken. The estimate is from the Center for Agribusiness Studies of Fundação Getúlio Vargas (FGV Agro).The institution conducted the study on the economic loss in this hypothetical scenario at the request of the National Union of Federal Agricultural Inspectors (Anffa Sindical). The study considers the direct and indirect effects on exports, income generation, salaries, taxes, and employment.Talita Priscila Pinto, a doctor of Applied Economics and researcher at FGV Agro, said the study is based on the possibility of an uncontrolled outbreak and in industrial production - something that hasn’t happened in Brazil yet, since the outbreaks detected so far have been in wild birds and one in domestic breeding."When a certain sector of the economy suffers, there is an impact on the others related to it," she said. "We would not see this impact immediately, but it would repercussions over time."The direct damage to the agricultural sector alone is estimated at R$11.8 billion.The study also predicts a R$1.3 billion drop in tax revenue and a R$3.8 billion drop in income for the national economy. According to the FGV Agro specialist, the impact in the purchase of inputs, transportation, and other items is included in this income category.The study also estimates a potential loss of 46,000 formal jobs in several sectors, including 26,000 in the agriculture sector. With this, there would be an impact of nearly R$1.25 billion in salary payments.For the president of Anffa Sindical, Janus Pablo Macedo, the diagnosis of FGV Agro has an important role in bringing indicators and projections of how the avian flu can negatively affect the economy."Brazil has the capacity to act in the face of a possible outbreak. We are working with the Ministry of Agriculture and state agricultural auditors to avoid such effects," he said in a note.The FGV Agro analysis also shows that for every R$100 loss in the value of poultry meat exports, the commerce sector...

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