Colorado State: Animal Diseases and Traceability

Concerns regarding animal diseases and related perceptions about food safety have escalated substantially in recent years. The terrorist attack on the United States in September 2001 greatly increased awareness of vulnerability of U.S. agriculture to bioterrorism. In addition to heightened bioterrorism concerns, increased globalization and world travel make transmission of foreign animal diseases more probable.

Discovery of a dairy cow infected with bovine spongiform encephalopathy (BSE) in the United States in 2003 and the subsequent loss of world beef markets for the U.S. demonstrate the economic impact animal health can have on livestock and related industries. The BSE incident resulted in immediate closure of major U.S. beef export markets (including Japan and Korea). Losses to the U.S. beef industry resulting from export restrictions during 2004 have been estimated to range from $3.2 to $4.7 billion.

The UK has experienced two recent foot-and-mouth disease (FMD) outbreaks, 2001 and 2007. FMD was confirmed in cull sows at an abattoir in Great Britain on February 20, 2001. At least 57 premises were infected by the time the first case was identified. By September 30, 2001 when the outbreak was eradicated, 221 days after the initial outbreak, 2,026 cases of FMD had been confirmed, approximately 6.5 million animals were destroyed, and the disease had spread to Ireland, France, and the Netherlands. It took an additional 114 days (until January 22, 2002) for the UK to gain “FMD-free without vaccination” status by the OIE. It has been estimated losses from FMD in the UK to be $10.7 to $11.7 billion U.S. This illustrates the economic impact such a disease outbreak can have and the need to understand probable economic impacts of a highly contagious disease in order to develop effective public policy.

The most recent FMD outbreak in the UK (which was confirmed on August 3rd) was declared over (i.e., FMD free status by the World Animal Health Organization (OIE)) on February 22, 2008. After further investigation, it was determined that the FMD virus leaked out from drainage pipework at the Pribright laboratory, which houses the Institute for Animal Health and Merial Animal Health, contaminating the soil and then was transported via vehicles to a nearby farm. This outbreak was less severe than the 2001 outbreak because there were systems in place. For example, the government’s crisis management team was convened within three hours of the first case being confirmed in 2007 compared to the 2001 outbreak in which it did not meet for 31 days.

One possible way to combat spread of contagious diseases is through animal traceability. Ability to rapidly identify locations where an animal has been affects the ability to isolate, trace, and arrest spread of the disease. Animal traceability systems are rapidly developing throughout the world, and the U.S. is behind many other countries in this development. Efforts to develop animal ID systems in the U.S. were launched prior to the initial BSE discovery, but they gained considerable momentum afterwards. The goals of the National Animal Identification System are to: (1) “enable industry partners and State and Federal animal health officials to respond rapidly and effectively to animal health emergencies such as foreign animal disease outbreaks or program diseases (diseases that have surveillance programs in place) with potentially significant animal health, public health, economic, or social consequences; (2) support ongoing animal health safeguarding and disease detection and response capabilities in order to complete current eradication programs; (3) protect United States exports and meet the growing international market demand for systems that provide timely animal identification capabilities, thus expanding international trade opportunities; and, (4) protect domestic markets and consumer confidence, thus increasing overall consumer demand that benefits all producers” (USDA-APHIS, 2007. http://animalid.aphis.usda.gov/nais/naislibrary/documents/guidelines/NAIS-UserGuide.pdf).

The objective of this study was to determine the economic implications of improvements in animal ID systems on a hypothetical FMD outbreak in southwest Kansas. Specifically, a disease spread model was used to determine the probable spread of a hypothetical FMD outbreak. Results from the disease spread model were integrated into an economic framework to determine the economic impacts.

What We Did
To accomplish our objective, we used an epidemiological disease spread model to simulate a hypothetical FMD outbreak for three different animal identification levels in cattle; referred to as high-, medium-, and low-levels of identification intensity. High animal identification intensity is a system that has a 90 percent success rate of both direct and indirect trace-back within 24 hours. In other words, the trace-back of a herd would be successful 90 percent of the time when coming in direct or indirect contact with an infected herd. Medium- and low-level identification systems have 60 percent and 30 percent trace-back success rates, respectively. The results from the disease spread model, including total number of fed, feeder, and dairy cattle, and market hogs that were destroyed and total costs associated with the FMD outbreak, were integrated into an economic model. The economic framework consists of a set of supply and demand equations for beef, pork, and poultry sectors that provides horizontal and vertical linkages within the farm-retail marketing chain. The economic model was used to evaluate consumer and producer losses in the beef, pork, and poultry sectors.

What We Learned
The total number of infected animals and the length of disease outbreak, are among the most important epidemiological factors that affect economic impact. As the level of traceability in cattle increases, the number of animals that have to be stamped out and related costs decrease. With a low-level ID system approximately 790,000 head of livestock were destroyed. The number of head destroyed at medium and high surveillance levels were lower, 550,000 and 265,000, respectively. This is equivalent to a reduction in the quantity of fed cattle in Kansas by 14% with low-intensity animal identification, 10% with medium-, and 5% with high-intensity identification.

In general, as traceability levels were increased, consumer and producer losses associated with a FMD outbreak become smaller. The simulation models predict producer losses in the beef industry to be $584, $502, and $405 million with low-, medium-, and high-level ID systems, respectively. Producer losses for the meat industry (i.e., beef, pork, and poultry) for low-level identification were $535 million and for medium- and high-levels of animal trace-back producer losses were $472 and $399 million, respectively. Total consumer losses in the short-run were $271, $220, and $154 million for low, medium, and high traceability levels, respectively.

The critical results discussed above demonstrate the importance animal identification can have on a hypothetical FMD outbreak. As the intensity of animal identification increases, the number of animals destroyed decreases as do the associated FMD-related costs. Further, increases in animal traceability levels reduce both consumer and producer losses.

Source - Dustin Pendell, Assistant Professor in the Department of Agricultural and Resource Economics Colorado State University