Voluntary Report - public distribution

**Date:** 12/9/2005

**GAIN Report Number:** SP5043

PO0000

**Spain**

**Poultry and Products**

###### Bird Flu and its effects in Spain

**2005**

**Approved by:**

![](media/image1.wmf)Stephen Hammond

U.S. Embassy

**Prepared by:**

Justin Taylor

**Report Highlights:**

The Spanish government is preparing for the possibility of a bird flu
outbreak, while attempting to buoy consumer poultry meat demand by
distributing consumer information about the safety of poultry meat.
Spanish poultry producers and processors claim that the bird flu scare
has resulted in lower-than-traditional prices, and are calling for the
Government to provide compensation payments. (JT25SH1)

Includes PSD Changes: No

Includes Trade Matrix: No

Unscheduled Report

Madrid \[SP1\]

\[SP\]

According to local sources, the bird flu scare has resulted in a
short-lived reduction in poultry meat consumption during late October
and early November; however, it appears that Spanish Government efforts
to allay consumer fears, a reduction in poultry-meat prices, and
consumer loyalty may have mitigated the potential for a
medium-to-long-term consumption downturn. A Spanish Government press
release dated December 1, 2005, states, "for the 3^rd^ week of November,
poultry meat consumption is up 13 percent over the same week in 2004."
The press release states that some of the increase in consumption can be
attributed to the effects of a large governmental public information
campaign, in place during all of last month, to make local farmers,
processors, and consumers aware of the safety of Spanish poultry meat,
given the measures implemented by the Government. This effort included
the production of 150,000 pamphlets distributed to farmers and
processors identifying how to recognize the Avian Flu in a poultry
flock.

Spanish poultry producers remain unconvinced, as demonstrated in a
statement from the secretary general of the Spanish poultry association,
declaring that, "if the Spanish Government does not adopt measures to
support the poultry industry this week, there will be a total and
complete collapse of the industry, including the closure of many
slaughterhouses, farms and a loss of jobs." The association says that
poultry prices are about .50 Euros per kilogram below the cost of
production and asks the Spanish government to begin to make emergency
payments before it is too late.

The price data provided by the Spanish Ministry of Agriculture in the
chart below indicates that the current poultry price is about 33 percent
below the price at this same time last year, while only slightly below
the 2003 price. The Spanish poultry association believes that this
year's historically low price, for this time of the year, is directly
connected to the bird flu scare and, as a result, has called on the
Government to take immediate action to assist the thousands of poultry
producers in Spain.

![](media/image2.wmf)

Source: Spanish Ministry of Agriculture
<http://www.mapa.es/es/estadistica/pags/preciostestigo/frgraficos.asp?codigo=16>

\*This particular data set of "at market" prices is not available prior
to May 2003.

While the Government has made a concerted effort to buoy poultry meat
consumption, Government officials have also dedicated resources to
minimizing the possibility of bird flu contagion in Spain. We expect
that the Government officials will continue to hold regular meetings of
its bird flu monitoring committees, including the inter-ministerial
commission for security and information related to bird flu (the
commission is an attempt to coordinate the Government's efforts across
all ministries related to bird flu and report the Government's efforts
in combating the potential problems), and that they will continue to
adhere to any new decisions from the European Commission.