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Tough year for turkeys: 2015 bird flu affected entire industry

ROTHSAY, Minn. -- Max Velo's turkey farms didn't take a direct hit from the bird flu epidemic of 2015, but he's quick to say "100 percent of the industry was affected," emotionally and operationally.

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Broad-Breasted White tom turkeys have colorful blue heads. The Velo family raises some, but mostly the lighter-weight hens for the whole bird market. (Minnesota Turkey Growers Association)

ROTHSAY, Minn. - Max Velo’s turkey farms didn’t take a direct hit from the bird flu epidemic of 2015, but he’s quick to say “100 percent of the industry was affected,” emotionally and operationally.
And it’s not clear whether it’s over, yet.
Velo, a member of the Minnesota Turkey Research and Promotion Council, says the bird flu kills live birds and doesn’t affect products. Still, turkey products from affected states - including Minnesota and the Dakotas - temporarily were banned from some countries, including Mexico and the European Union.
U.S. turkey production by weight is down only slightly.
U.S. processors, including Northern Pride Inc., the cooperative the Velo family delivers to, shuffled and shifted products to processors in Ohio, to lessen the export market impact, which largely involved dark meat products.
The epidemic was cataclysmic for individual producers, but so far has minimal impact on American consumers.
Tiny consumer story
Steve Olson, executive director of the Minnesota Turkey Growers Association and the MTRPC, says frozen turkey prices for this year’s Thanksgiving dinner averages $1.08 per pound - up 9 cents per pound from last year. It is unclear how much of that is because of the bird flu outbreak, or how much is from other competitive and local pricing factors.
An average home-prepared whole turkey is 16 pounds, which feeds about 16 people, so an additional 9 cents per pound is an increase of $1.44.
Turkey is typically a low-cost meat source and historically has accounted for about half the cost of a homemade turkey meal.
“The stores will still use turkey as a loss leader item,” Olson says. “It’s still going to be a good value, with 59 cents up to 99 cents per pound.”
The American Farm Bureau Federation typically surveys components for the price of an average turkey dinner, but those figures for 2015 won’t become available until Nov. 19.

READ ABOUT THE VELO FAMILY HISTORY: Velos are long-time turkey leaders
Hard hit Minnesota
Olson says the main impact from bird flu was on individual producers. About 12 percent of Minnesota turkeys and 2 percent of U.S. turkeys were destroyed because of bird flu, and about 40 percent of the egg-laying chicken hens - a total of 9 million total birds in the state, including 5.5 million turkeys.

“For any one grower, they lost about a third of their income for the year, because of down time,” Olson says.
The disease also hit turkey operations in South Dakota and North Dakota.
Since then, about 95 percent of farms affected have repopulated. The economic statewide impact was estimated at $650 million. Federal and state indemnity programs blunted some of that loss, but exact figures were not immediately available.
A large number of the breeding hens in Minnesota and almost 100 percent of the breeding hens in some of the largest production counties, including Kandiyohi, were hit with the disease.
Stricken facilities had to be emptied for at least three months and pass a pathogen test before repopulating.
“It’s not exactly like a death in the family, but it’s pretty emotional,” Velo says. “It’s not something people want to talk about.”
Velo, who farms with his father Daryl and uncle Dale, expected the price of poults - the day-old chicks he buys to populate his barns - might increase because of this.
So far, that hasn’t happened.
Offsetting the financial costs, turkey farms are seeing significantly lower prices of feed commodities, which makes up a far larger percentage of the total cost of a finished bird than the poult cost.
The Velos’ Damart Turkeys Inc. involves about 15 barns in an eight-mile radius on the west edge of Otter Tail County and part of Wilkin County.
The Velos rent a couple more barns from relatives and employ six people full-time to take care of the turkeys and 2,600 acres of farmland.
The Velos raise mostly hen turkeys and market them through Northern Pride Inc., a grower-owned turkey processing facility in Thief River Falls, Minn. Max’s father, Daryl, sits on the board of directors.
Similar to about 20 others in their processing cooperative, the Velos are seasonal producers, meaning they empty their barns in early November and start bringing in day-old “poults” in late January and early February, usually from the Willmar, Minn., area.
The poults grow in a brooding barn for four to six weeks and the Velos transfer them to bigger finishing barns. They mature in 12 to 20 weeks and are sold at weights ranging from 13 to 22 pounds, all for the bagged, whole bird market.
Max says other farmers and companies raise the male “tom” turkeys that grow to as high as 50 pounds - too big for the whole bird market - but significant in the processed or export market.
The barns were emptied a bit earlier than usual on Nov. 4, and the Velos won’t bring in new flocks until late January.

The flu specter
Velo will never forget the spreading fears during the epidemic.
“Some of the first cases in the U.S. were in California and then it kind of made a jump to Minnesota,” Max recalls. There seemed to be a lull after that first case, and then it snowballed in Minnesota, and became “stressful for everybody,” he says.
The Velos had about 150,000 poults in barns, about 40 percent filled. The Velos were worried about those, but they were still getting fresh flocks of 12,000 to 50,000 birds every week or two.
Things became dire by late April when a number of new cases were being added, and barns near Fergus Falls, Hawley and Perham were hit. “I thought, ‘Boy, that’s really close to home,’” Max says. “That’s when it really started to get stressful, for sure.”
On April 14, John Burkel, a member of Northern Pride Inc., got the disease at the family’s barn site near Badger, Minn., in the Roseau area. It was a blow to the Northern Pride co-op. Burkel is a leader in the co-op, served as National Turkey Federation chairman in 2013 and received the title of 2014 Turkey Promoter of the Year from the state association. He’d been quoted on the cover of the Wall Street Journal, Time magazine and CNN.
Daryl says officials of the Northern Pride plant were concerned that members might pay for poults and not take delivery of them and incur the feed and labor costs. The first loss of poults accounts for up to 16 percent of the ultimate cost of bringing a bird to market weight. The plant, which employs 250 people, needed production to stay in operation.
Ultimately, everyone “stayed on the raft” and the co-op continued. “We had a projected number for the year, and that (production) number held up,” says Daryl, a member of the Northern Pride board.
Wild bird source
There was a theory that wild geese and ducks carried the disease, and then they were migrating through the region in large flocks. Sometimes they were landing near the Velo barns. The Velos took old vehicles and parked them in areas to spook the flocks.
With advice from the U.S. Department of Agriculture and Minnesota Department of Agriculture, turkey producers instituted biosecurity measures.
Like others, the Velos had mail and other deliveries dropped at off-farm locations. They stopped trucks at the farmstead driveways, washing and disinfecting tires and frames before the trucks visited the barn sites. They had to take a tank with a pump, or sometimes use a hand-pump to wash the tires.
“The general consensus was that you had to consider everything outside of the physical barn as contaminated,” Max says. “You had to get the trucks unloaded without touching the outside ground. Doing that without bringing dirt into the barn was tough.”
Ongoing biosecurity
Barn procedures involved the so-called “Danish protocol,” which involved disinfecting and then changing to inside boots, changing coveralls and gloves that were laundered daily, and using hand sanitizers. Most, if not all, of those precautions will continue as the new normal.
Max credits Minnesota Department of Animal Health for vigilance, which used a special laboratory in Minneapolis to check tracheal swabs of birds if there was “any question at all” about their cause of death. He also credits USDA with assistance in establishing an indemnity program that partially covered losses of the disease if they were reported early.

“The reason for that is so that people don’t cover it up,” Max says. “If you’ve got it, make sure everybody knows it, so we don’t perpetuate it. If they hadn’t had that program, it would have put people out of business.”
Max credits his own farm staff for vigilance in carrying out the biosecurity measures. He says his farms also probably benefitted from being geographically isolated from other turkey production, but he is quick to acknowledge the simple good luck.
His uncle, Dale, one of the corporation owners, says part of the survival was a “numbers game,” where the operations in more concentrated populations are more vulnerable.
“But they say if biosecurity isn’t a pain in the ass, you’re not doing it correctly,” he says.
“I think everybody was doing a really good job,” Max says. “A lot of really good guys were hit with this. People were doing the best they could.”
Psychological hit
The ongoing psychological impacts of the disease are difficult to measure.
Olson says he recently heard a turkey farmer discuss the impact on workers who watched the birds die, but could do nothing about it.
Max says he feared for his operation until the end of June. “That was when there wasn’t a new case for an entire week,” he recalls.
Earlier, there were periods of five to ten cases a day when every day was stressful.
“You just trudged along and hoped you made it through the day without getting a sick flock,” he says.
There is a consensus the disease pathogens originated in wild birds, partly because it popped up in 40 places without any physical connection.
“I don’t think there’s a definitive answer on how it was spread around,” Max says. The disease theoretically could resurge when outdoor temperatures fell to near freezing, but that hasn’t happened.”
He says, “Everyone was expecting resurgence, or that this could reappear on the East Coast this fall. It hasn’t happened yet and I don’t know if anybody could tell you why.”
Producers take some solace in the fact that there was a similar outbreak in the Shenandoah Valley of Virginia in 2002.
“I guess it wiped out every turkey and chicken and everybody expected it to come back in the fall, but it didn’t and it hasn’t come back since,” Max says.
That’s one reason for hope at Thanksgiving time.

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