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Potential revenue impact of an outbreak of foot-and-mouth disease in the United States

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  • 1 Department of Agricultural Economics, School of Agriculture, Purdue University, West Lafayette, IN 47907.
  • | 2 Department of Agricultural Economics, School of Agriculture, Purdue University, West Lafayette, IN 47907.
  • | 3 USDA: Animal and Plant Health Inspection Service, Centers for Epidemiology and Animal Health, 555 S Howes, Fort Collins, CO 80521.

Abstract

Objective—To estimate potential revenue impacts of an outbreak of foot-and-mouth disease (FMD) in the United States similar to the outbreak in the United Kingdom during 2001.

Design—Economic analysis successively incorporating quarantine and slaughter of animals, an export ban, and consumer fears about the disease were used to determine the combined impact.

Sample Population—Secondary data for cattle, swine, lambs, poultry, and products of these animals.

Procedure—Data for 1999 were used to calibrate a model for the US agricultural sector. Removal of animals, similar to that observed in the United Kingdom, was introduced, along with a ban on exportation of livestock, red meat, and dairy products and a reduction and shift in consumption of red meat in the United States.

Results—The largest impacts on farm income of an FMD outbreak were from the loss of export markets and reductions in domestic demand arising from consumer fears, not from removal of infected animals. These elements could cause an estimated decrease of $14 billion (9.5%) in US farm income. Losses in gross revenue for each sector were estimated to be the following: live swine, –34%; pork, –24%; live cattle –17%; beef, –20%; milk, –16%; live lambs and sheep, –14%; lamb and sheep meat, –10%; forage, –15%; and soybean meal, –7%.

Conclusions and Clinical Relevance—Procedures to contain an outbreak of FMD to specific regions and allow maintenance of FMD-free exports and efforts to educate consumers about health risks are critical to mitigating adverse economic impacts of an FMD outbreak. (J Am Vet Med Assoc 2002;220:988–992)

Abstract

Objective—To estimate potential revenue impacts of an outbreak of foot-and-mouth disease (FMD) in the United States similar to the outbreak in the United Kingdom during 2001.

Design—Economic analysis successively incorporating quarantine and slaughter of animals, an export ban, and consumer fears about the disease were used to determine the combined impact.

Sample Population—Secondary data for cattle, swine, lambs, poultry, and products of these animals.

Procedure—Data for 1999 were used to calibrate a model for the US agricultural sector. Removal of animals, similar to that observed in the United Kingdom, was introduced, along with a ban on exportation of livestock, red meat, and dairy products and a reduction and shift in consumption of red meat in the United States.

Results—The largest impacts on farm income of an FMD outbreak were from the loss of export markets and reductions in domestic demand arising from consumer fears, not from removal of infected animals. These elements could cause an estimated decrease of $14 billion (9.5%) in US farm income. Losses in gross revenue for each sector were estimated to be the following: live swine, –34%; pork, –24%; live cattle –17%; beef, –20%; milk, –16%; live lambs and sheep, –14%; lamb and sheep meat, –10%; forage, –15%; and soybean meal, –7%.

Conclusions and Clinical Relevance—Procedures to contain an outbreak of FMD to specific regions and allow maintenance of FMD-free exports and efforts to educate consumers about health risks are critical to mitigating adverse economic impacts of an FMD outbreak. (J Am Vet Med Assoc 2002;220:988–992)