AI strikes troubled Russian poultry business

By Vladislav Vorotnikov

- Last updated on GMT

Avian influenza hits Russian broiler
Nearly 300,000 chickens have contracted highly pathogenic avian influenza (AI) at a farm owned by Russia’s major broiler meat producer Belaya Ptitsa in Rostov Oblast, Russia.

The outbreak was officially confirmed by the regional veterinary services on 2 October, the regional government said in a statement on its website.

All the production sites of Belaya Ptitsa-Rostov, the regional subsidiary of Belaya Ptitsa, had been logged as sites of the outbreak and put under quarantine, the government reported.

The company had ceased supplying poultry products from the production sites under quarantine, the government said. The overall losses from the incident are yet to be estimated.

Infected broilers culled

No information has been published about how many chicken had to be culled in total. The regional veterinary service only confirmed that all infected broilers had to be culled, and did not supply any details about healthy chickens.

Belaya Ptitsa’s press office had not yet provided any further information on the outbreak to GlobalMeatNews​ by the time this article was published.

The incident adds to pressures faced by the company, which has been struggling financially and grappling with debt levels​ for the past 10 months.

In particular, Belaya Ptitsa had started preparing its production assets in Rostov Oblast for temporary shutdown, regional agricultural minister Konstantin Rachalovsky revealed at a July press conference.

Shut down subsidiaries

The company has confirmed that it had to shut down two subsidiaries in different regions of Russia, local news outlet Agroinvestor​ reported, adding that its overall debts had reached RUB26bn ($480m).

The company has faced financial difficulties following the collapse of local bank Promszyazbank on 15 December 2017, from which it had been taking on loans. As a result, the company’s lending for operational purposes was suspended.

Belaya Ptitsa is Russia’s fourth-largest poultry producer, according to the Russian Union of Poultry Producers, or Rosptitsesoyuz, with the capacity to manufacture 302,000 tonnes (t) of broiler meat. In 2016, the company produced 5% of all poultry on the domestic Russian market, Rosptitsesoyuz has estimated.

It is unclear how the AI outbreak could affect reported plans by Russia’s biggest meat producers to acquire Belaya Ptitsa.

Negotiating to sell

Speaking earlier this year, Igor Barshuyk, founder of Belaya Ptitsa confirmed the company was negotiating to sell its production assets to Cherkizovo or RusAgro.

While Cherkizovo has not commented on anything related to those negotiations, RusAgro has denied their very existence.

“There is nothing, and from nobody, that we can buy,”​ said Maxim Basov, general director of RusAgro, shortly after the news about the AI outbreak at Belaya Ptitsa’s farm. “The company [Belaya Ptitsa] is bankrupt. Its shares cost nothing. We can consider [acquisition] as soon as the banks make their decision and determine a price on the assets, as the situation is constantly getting worse.”

Related topics: Safety & Legislation, Russia, Poultry

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