EU Uncertain About Bird Flu's Economic Consequences

Italy is already suffering from a "chicken psychosis," as Munich's Süddeutsche Zeitung put it. Fearing infection with the deadly H5N1 virus, eight out of 10 Italians have stopped eating poultry. The drop in consumption has reportedly led to the loss of 30,000 jobs over the last couple of months so far. The economic damage comes to 600 million euros ($714 million).

But Bernd Adleff, the president of Bavaria's Poultry Association, said that talk about the bird flu's economic damage was vastly exaggerated.

"You don't need to believe such nonsense," he said, adding that consumers were insecure and hesitant about buying poultry.

But Adleff said he didn't believe this would lead to long-term problems.

"It's just a trend and a short-lived development," he said. "The consumer will forget quickly."

The media's responsibility

Georg Alpers, a psychologist at Würzburg University, also warned against blowing the danger out of proportion.

"At the moment we don't know what the real dangers are and how we can protect ourselves against them," he said, adding that people get scared because of insecurities that arise through extensive media coverage about the potential danger.

Adleff also blamed the media for the current problems.

"We're hurting because the media constantly report on this garbage," he said. "The consumer start to believe that he's in extreme danger, which is wrong."

EU offers pragmatic help

Officially, no hard numbers exist yet to assess the economic damage caused by bird flu within the EU, said Michael Mann, the press spokesman for EU Agriculture Commissioner Mariann Fischer-Boel.

"We have first indicators," he said. "Some member states have told us about a 15 percent drop in poultry consumption."

A compulsory poultry lockdown like the one that took effect in Germany on Friday could have consequences for farmers who keep free-range chicken.

"We've so far managed to find pragmatic solutions for them to keep marketing their produce like they did before," Mann said. Free-range chicken will still be sold as such even though the animals are currently kept inside.

No state help needed?

The EU itself has little resources to compensate farmers, Mann said, adding that Brussels can help farmers if there's a bird flu outbreak among domestic animals.

Should a farmer be forced to destroy his stock and eggs, the EU can pay for half the costs to renew the livestock.

"We can also raise export subsidies to help the sector to export produce," Mann said. "The more meat is exported, the less remains on the domestic market and that's good for prices."

Adleff, however, said that farmers would manage to get by without help.

"The industry will deal with this on its own," he said. "We don't always have to call for state support."