[music]

Hello, I'm Rebecca Jones and welcome to

the Bloomberg Australia podcast.

This week, Australia's battle with

supermarket inflation may be facing a

new threat. Bird flu is spreading among

Australia's wild birds, [music] with

deaths surging in recent weeks and cases

now detected across five states.

So, how worried should we be and where

could the economic fallout hit hardest?

I'm joined by Melbourne based

agriculture reporter Ben Wescott to look

at what previous outbreaks can tell us

about what may be in store here. Ben,

thank you for joining me and welcome

back to the podcast.

>> Good to be back, Beck.

>> Ben, where does the bird flu outbreak in

Australia currently stand? How far has

it spread and how likely is it to reach

our commercial poultry farms?

>> Currently, there are 231 cases uh in

Australia, although that might change

any day now as it's always ratcheting

up. Now, 231 doesn't sound like very

much. Um I was recently talking with my

boss who remembers the outbreaks in the

US that we'll come back to later when

millions of birds were affected. And so

when I said that they were tripling in

the space of just a week, she was like,

"Oh, 231 cases. That's not very many.

But if you consider how fast it's

growing, this is a massive uh change in

just a small short period of time. Just

2 weeks ago, we only had 27 cases. So,

it's increased by about 10 times in just

the space of 2 weeks. And of course, a

month and a half ago, we didn't have any

cases at all. Now, currently, they're in

uh mostly in South Australia and

Victoria, uh which is where a huge

number of Australia's egg and poultry

farms are located. uh but they're also

in Western Australia, in New South

Wales, and then finally in Queensland as

well. Now, in terms of how likely this

is to enter our poultry farms, what the

experts are saying is that once it

actually arrived in Australia, it was

almost inevitable that it was going to

start spreading among local wildlife.

It's very hard to separate, you know,

wild birds or direct them where to go. I

think there's a lot of songs about that.

You can't do that. When it comes to

poultry farms, you do have a modum of

control and they have been preparing for

this. So, while it's highly likely they

are going to spread to poultry farms, it

isn't 100% that we might not be

incredibly lucky and miss.

>> And what are governments and and poultry

producers themselves doing to keep the

virus out of these commercial flocks?

>> So, in many ways, Australia has been

very lucky up until now. We're the last

continent to be infected by the bird

flu. Uh many other countries have had

this for a very long period of time and

that uh long leeway, America had this as

as far back as 2022. So that long leeway

has given us a long time to prepare for

this coming to our country which means

that poultry producers have managed to

set up a number of biocurity regulations

to protect their birds. So things like

effectively sealing them in uh so that

wild birds can't come and contact them,

passing on the virus, protecting their

food sources, protecting their water

sources, and obviously putting in place

some of the security regulations that

people would be very familiar about

after co things like PPE and stuff like

that for employees,

>> sealing them in. How does that work with

freerange chickens? What a glass dome

above the yard or

>> a great question. But also, in fact,

freerange chickens are possibly going to

have to be housed. And this is something

that we've already seen in Victoria.

They issued on Friday a housing order

for freerange chickens that they must

mandatorily be brought inside. And that

means that they can be protected from

contact with wild birds and thereby

reduce the spread of the virus. So for a

while in Australia, depending on what

state governments do because it's their

decision, not the federal government, we

might have a very severe reduction in

the number of freerange birds we have.

>> A housing order has sort of dystopian

undertones, doesn't it? Ben, if the bird

flu does enter the commercial poultry

industry here in Australia, where would

we as consumers first notice shortages?

Is it going to be through higher prices

or purchase limits? and and how quickly

could this happen?

>> It could be any of the above. So, so let

me take you back to the uh US outbreak I

mentioned before that took place

starting in 2022 and it it did rapidly

infect uh domestic poultry flocks. Uh

and in the end, you know, that that

spread to millions and millions and

millions of birds. And what you saw by

the end of 2022 is the egg prices had

spiked. They doubled in uh the space of

a year. Uh then they went down again.

But then when there was another even

larger outbreak in 2025, they went to

triple the amount they had originally

been. So eggs are very very severely

affected by these bird flu outbreaks. Uh

chicken meat prices not so much. But

there's no doubt that this is something

that Australians have seen before,

particularly after co there was a little

bit of those constraints, particularly

in places like the ACT. Our CRA

listeners will be very familiar with the

restrictions that were put on purchases

of eggs there. What this means is that

while in general, you know, egg people

can probably deal with paying a bit more

for their eggs, this comes at a time of

very high inflation across the board for

Australia. You know, we're well above

the RBA's target, hence all the rate

rises to try and drag that back under

control. So any additional, you know,

causes of inflation outside of fuel and

uh plastic prices, which are obviously

going up, I just going to add even more

heat to that fire and make life just a

little bit more difficult for everyday

Australians. I think that's really

fascinating that you said that the the

price shock would be felt in egg prices

but not so much in chicken meat. Can you

explain why that would be?

>> So it's a combination of two things.

Firstly, chickens the chickens that we

eat and chickens that lay the eggs are

kept separately from each other. So

they're not necessarily in the same

place, which means when one flock is

affected, the other one possibly won't

be. But in addition to that, it the

maturity cycle for egg laying chickens

is a much longer cycle. It takes more

time to replenish those stocks of egg

laying birds compared to the meat birds

which have a much shorter maturity. So,

it's much harder for farms to replace

the egg laying chickens than it is for

them to replace the meat chickens.

>> And those chickens that are bred just

for meat, they can turn them over pretty

quickly, right? Like 6 to 8 weeks or

>> it's it's much shorter than it is for

the egg chickens. Yeah.

>> Well, that that does make sense. Um,

Ben, I'm interested also in who

ultimately is carrying the financial

cost here when the commercial flocks of

of chickens have to be cold. Is it as

simple as farmers and and insurers or

does that cost show up in in forms of

the retailers and and us as the end

consumers?

>> It will show up everywhere. So, of

course, some of it will come down to the

consumers. I mean, already egg prices in

Australia are quite high. Uh, I mean,

I'm sure we've all been down to the

supermarket and spent, you know, 12, 13,

$14 on a dozen eggs. Um, and that will

likely rise as the bird flu outbreak

gets worse if it does get into our

poultry industry. But yes, there's no

doubt these will be felt all down the

food chain. It's like the the plastic

resin shortages that we've seen around

the region as a result of the strait of

Hormuz. So you know when you can't

package milk for instance in the case of

the dairy industry that impacts the

farmer who can't sell the milk that

impacts the packager who can't package

the milk up and can't get the resins at

a cheap price to make the milk and it

impacts the customers who eventually

have to buy the milk. So you know when

you have these shortages the prices go

up all through the supply chain and

everyone's

I just want to pick up on on something

that you said there, Ben, and go back to

the 2022 example in the US because that

incident also affected dairy cows.

Australia and New Zealand both have

substantial populations of cows. How

could that show up here? And and what

lessons can we learn from what happened

in the US?

>> Yeah, sure. I mean, it's going to be

particularly worrying for um New

Zealand, which has such a vital dairy

industry. its dairy industry is a major

part of its economy. Now there's good

news and bad news here. So I'll start

with the bad news which is that as you

mentioned in the US we saw the bird flu

infect mammals and this has been one of

the reasons why this particular um type

of virus has been so devastating around

the world is that it isn't just limited

to birds. It gets into various mammal

species and one of those in the US was

dairy cows and that was how we believe

in some cases it transmitted to humans.

Um and we have had a small number of

human cases of bird flu in the US about

70 or a bit more than that. Um now that

was very bad for the US dairy industry.

There was it was bird flu was found in

the raw milk which severely impacted

them. Now the thing that scientists are

saying in Australia is that the strain

of bird flu here is not as um is not the

type that we found in the US and

therefore the dairy industry probably

doesn't have as much to worry about as

their US counterparts. Now does that

mean they're completely safe? Absolutely

not. And I think as this virus spreads

more in Australia, one of the things

that will be very closely watched by

scientists, government, and the

agricultural industry will be how this

strain of bird flu affects mammals and

how quickly it spreads among some of

Australia's very unique mammal species.

We already know that something quite

similar to this was found in the

Antarctic Islands where devastated

researchers talked about just beaches

and beaches of dead seals who had been

killed by this virus. It's not out of

the question we see something like that

in Australia and if so, how does that

affect the agricultural industry? Does

it get into our our beef cattle, our

dairy cattle? You know, all these are

questions that are still to come. Criy

Ben, you're talking about this so

calmly, but I have to remind you that

you and I are also mammals. So that's

terrifying. Who are you talking to about

this, Ben? Are you getting out to the

egg farms themselves? Are you talking to

the investors? Are they particularly

worried about this? What are they

telling you on the street?

>> Yeah, I mean, I've I've spoken to

everyone from some of the major egg

producers in Australia all the way down

to the experts, the cold face, sort of

dealing with this. And I mean I think

everyone is very sad about the fact that

it has come to this. I mean it was

always somewhat inevitable that Berkeley

was going to reach Australia's shores. I

think everyone kind of felt that. But

now it's here. There is concern about

where it could go particularly because

it is such an unpredictable virus. As

they were saying to us in a briefing

last week in some countries this has

become a sort of seasonal thing almost

like the cold for human beings. like

sometime the birds get sick during some

months and then it goes away and then it

comes back again the next year and then

in some other countries it just ravages

the country. It doesn't leave and you

know they're still seeing regular cases

all year round. So because of that we

don't know exactly where the virus is

going to go from here. We could end up

with you know thousands hundreds of

thousands of cases in Australia's native

wildlife. We could see it in the poultry

industry. We could see it in endangered

mammals or by this time in a few months

it might have vanished and only come

back next season, you know, and it's

that uncertainty that makes planning for

this so difficult for governments, so

difficult for companies and so difficult

for everyday Australians.

>> And I guess on a brighter or at least a

more predictable note, it's important to

mention too, Ben, that there is a

vaccine. How is that roll out going?

there is a vaccine and it's already

being administered as of today or to

captive native wildlife species. So the

plan is that they will um vaccinate

species of particularly endangered

wildlife in captivity in states and

it'll be up to the states to decide who

which which animals get administered to

begin with and then they'll sort of

decide where they go from there. One

thing we do know is that there aren't

plans at this stage to vaccinate egglang

animals or meat animals. At this stage,

it will just be native wildlife species.

>> Ben, finally, looking ahead, what are

some of the key developments or key

points that we should be keeping an eye

on over the coming days and weeks around

this issue?

>> Yeah, I mean, look, there are three

different things I think we should be

looking out for. The first is that, you

know, Australians as a population love

our native wildlife. We love our birds

and the dawn chorus. And I think even if

the poultry [snorts] industry remains

infectionfree, it will be a very

traumatic time for many Australians

seeing, you know, potentially large

numbers of dead pelicans, dead ducks,

fairy penguins could be affected and all

the way down to magpies and kabaras. So,

you know, there's a a wide variety of

birds that could be affected by this. Of

course, there's the poultry industry,

which is the next level. And I think the

government and the agricultural industry

we're watching very very closely for

that first infection that sort of

indicates it's got into the system and

once that happens things could move

quite fast from there. And then finally

of course there's always the chance of a

human infection and you know this is a

good chance to remind people that the

government says if you see a dead or

sick bird do not approach the bird. Just

alert authorities to its location report

what you saw and go from there. If you

found today's conversation insightful,

be sure to follow the Bloomberg

Australia podcast wherever you listen.

And for more on Australia's agricultural

sector, including the latest reporting

from Ben Wescott, head over to

bloomberg.com.

This episode was recorded on the

traditional lands of the Wereie people.

It [music] was produced by Paul Allen

and edited by Chris Burke and Anley

Chandler. I'm Rebecca Jones. We'll see

you next week.