Sanderson Farms has been enjoying improved demand for its poultry products from key regions to where the company exports.
However, the company has cautioned investors that the current outbreak of highly pathogenic avian influenza (HPAI) could change that. But, it hasn’t happened yet.
In a Form 10-Q on the Sanderson Farms investor relations webpage, the company, in addition to offering its financial reports for its most recent quarter, offered an update on trade matters and the HPAI outbreak in the United States.
In the executive overview of results section of the Form 10-Q, the company stated that demand for its products from its “traditional export partners has improved from levels we experienced during the early stages of the (COVID-19) pandemic.”
But since December 2021, when HPAI first appeared in North America (at an exhibition farm in Canada), the virus, and its potential impact on trade became an area of concern. The virus has grown closer to Sanderson Farms' operations as it has been confirmed in commercial poultry flocks in Indiana, Kentucky and Delaware.
“China and Mexico, the top two countries by volume and value to which we export, will initially ban all product from any state where (HPAI) is detected in a commercial flock. Mexico will subsequently initiate a process to coordinate with United States officials to reduce the ban from a statewide level to a county level as specified information regarding detection and remediation of (HPAI) is provided,” the company stated.
But since there have been no HPAI cases in any commercial flocks where Sanderson Farms operates, “we have not experienced any material disruptions to our operations or export sales,” the company stated.
Sanderson Farms further stated that it has initiated its crisis management response for avian influenza and is taking appropriate and best practice steps to protect the health of its flocks.
The company, however, recognized that it cannot be certain one or more of its flocks won't be affected by the HPAI virus.