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Bird flu: Backlash for food firms?
U.S. consumers don't appear to be cutting back on chicken; analysts say firms right to be cautious.
November 7, 2005: 4:41 PM EST
By Parija Bhatnagar, CNN/Money staff writer

NEW YORK (CNN/Money) - Despite the extensive media coverage of the bird flu and its westward migration, American consumers don't appear to be shying away from eating chicken -- yet.

Nevertheless, analysts say it's prudent for food companies and fast-food outlets selling chicken to take measures to educate consumers that it's safe to eat cooked poultry products.

"Americans aren't the most scientifically-savvy folks," said Richard Martin, managing editor of trade publication Nation's Restaurant News. "I heard news reports that some people were calling to enquire whether or not it's safe to eat turkey because they heard of the bird flu outbreak in Turkey. That's the country and not the bird."

A report in advertising industry magazine Ad Age Monday said Yum! Brands (Research), parent company of No. 1 fast-food chicken chain KFC, is preparing a public relations campaign to reassure customers that it's safe to eat chicken.

Yum! Brands did not immediately return calls to CNN/Money to confirm the report.

Additionally, the report said poultry producers Perdue and Tyson Foods (Research), the largest chicken producer in the U.S., were launching their own campaigns to inform consumers about how the avian flu may be contracted.

Both Perdue and Tyson could not immediately be reached for comment. However, a press release from last month on Tyson's Web site stated that the company was "constantly monitoring our flocks for the presence of disease; including avian influenza."

"While Asia's focus is on highly pathogenic H5N1, there are other strains of avian influenza that can affect poultry. While these other forms are not common in commercial poultry production, they do appear occasionally," the release said.

Tyson said it was using "biosecurity measures to protect bird health, such as "all-in, all-out" farming, which involves moving same-age birds in and out of production houses as one group or flock. We also require the use of protective clothing when people visit poultry farms, to prevent the spread of disease."

'Not a food-safety issue'

On its Web site, Perdue offered a consumer hotline number for consumers to call for food-safety questions. At the same time, the company maintained that the avian influenza "is not a food safety issue."

"No one has been known to be infected by eating poultry meat, even in Asia," the company said in a statement.

"Furthermore, proper cooking kills any germs that may be present, including avian influenza. Of course, we always recommend you follow proper handling and cooking methods, including washing your hands, avoiding cross-contamination, cooking thoroughly and refrigerating leftovers promptly."

The World Health Organization (WHO) which has been tracking the current outbreak, also maintains that "there is no evidence that properly cooked poultry or eggs can be a source of infection."

Harry Balzar, restaurant sector analyst with NPD Group, said he's been closely monitoring the firm's biweekly Food Safety Monitor report, a survey that gauges consumers' concern about the issue. The survey polls 1,000 people and has a margin of error of plus or minus 3 percent.

"At the end of September, 24 percent of people told us they were both aware and concerned about the Bird flu. That's up to 40 percent now," Balzar said.

Added Balzar, "But I'm not certain that this means consumers will eat less chicken going forward because what people say and what they do may not be the same."

However, he agreed that food companies and restaurant chains need to have the bird flu on their radar.

Why? "If it hits the U.S. poultry population and tens of thousands of birds are slaughtered, this will cause a significant disruption in supply, it will hurt poultry prices and hurt demand for chicken," Balzar said.

National Chicken Council (NCC) spokesman Richard Lobb disagrees with Balzar that a U.S. outbreak of the bird flu in poultry could have a significant impact on the industry.

"First of all, we don't have it in the U.S. and we're doing everything to keep it out," Lobb said. "If we have an outbreak, we could contain it. If we had to kill 5 million birds to eradicate it, that's still a very small number of our total annual production."

Added Lobb," Right now, I think the industry's concern with public perception of the problem is a much bigger issue than a substantive concern about an outbreak here."

To that end, Chick-fil-A, the second largest fast-food chain specializing in chicken products after KFC, said it has initiated an "internal contingency plan" to educate its suppliers and employees about the flu.

"We were aware about that KFC perhaps was working on a campaign," said Don Perry, spokesman with Chick-fil-A. "We're hoping that it doesn't get to that level.... Obviously food safety concerns are No. 1 priority for us and we're taking steps to communicate internally all those issues to our chains and suppliers."  Top of page

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