Chinese poultry industry struggles to survive H7N9

Lin Yuanzhong has killed more than 40,000 ducklings in the past 10 days as there is no sign anyone will patronize his duck breeding farm in Zini town, Longhai city in east China's Fujian province.

"If this continues for another 20 days, all the feed manufacturers, breeding farms and poultry raisers will be bankrupt," said Lin, who has been engaged in the industry for decades.

Even though the fast spread of H7N9 avian influenza has so far only hit Shanghai, Beijing and the provinces of Jiangsu, Zhejiang, Anhui and Henan, the ensuing fear has reached nationwide.

The outbreak since earlier this month has given China's poultry industry its hardest hit in a decade, with drastic declines in both poultry prices and consumption.

Xiao Zhiyuan, director of the poultry association of south China's Guangdong province, labeled the current crisis "the worst in history."

The SARS outbreak in 2003, H5N1 in 2005 and H1N1 in 2009 inflicted at most a daily loss of 5 million yuan (801,077 U.S. dollars) per company, but Guangdong Wen's Food Group Co., Ltd., one of the largest poultry raisers in China, has suffered a loss of 20 million yuan in one day this time, according to Xiao.

"We lost up to 100 million yuan from April 1 to April 14 and the loss is expected to hit 150 million yuan this month," said Liang Zhiyong, general manager of Wen's Food Group Co. Ltd.'s branch in Zhejiang province.

"We have been trying to get financing from various channels, but the gap is still huge," said Liang.

The area worst hit by the H7N9 crisis is east China, where the largest number of human cases of the virus have been recorded.

The wholesale price of live chicken was three to four yuan per kg on April 15, one-third of the price before the outbreak, according to the Jiangsu Provincial Commission of Rural Affairs.

The wholesale price of eggs was 6.5 yuan per kg, down 20 percent compared with that of late March.

Four cities in Jiangsu, including the provincial capital of Nanjing, have shut down live poultry trading markets, stagnating sales of poultry.

In Xuzhou city alone, there are more than 300,000 live poultry to be sold every day.

Jiangsu Lihua Animal Husbandry Co. Ltd., which sold 160 million broilers in 2012 and reaped 3 billion yuan in revenue, has killed more than 2.73 million growing broilers since the H7N9 outbreak as raising them will be cost-prohibitive, according to the commission.

As a whole, China's poultry industry suffered losses amounting to 10 billion yuan in the week after the first case of H7N9 was confirmed, according to the China Animal Agriculture Association.

The real impact of the disease will be far more than that as many consumers have been reluctant to eat poultry and some restaurants have stopped offering poultry dishes. The number of tourists visiting the affected provinces is also likely to decline.

To date, a total of 102 H7N9 cases have been reported in China, including 20 that have ended in death.