In knee-jerk fashion, neighbouring European countries responded by banning French chicken imports, while at home, French consumers similarly shunned poultry and related products. Profit margins for poultry farms (of at least 3,200 sq meters) across France fell on average EUR 20,000 in the first half of the year, according to the National Office for Meat and Dairy Products (Office de l'elevage).

A Ministry of Agriculture study estimates that in the year to end-May, poultry slaughtering across France fell 40 percent while the western region, France's top livestock production area, suffered a drop of 20 percent although it was not affected by the H5N1 bird flu virus. The crisis also bankrupted several mostly small farms and breeders who were forced to leave their sheds empty due to the halt in live bird production. Farmers reportedly bore the entire cost of culling their birds, at EUR150 for every tonne of birds destroyed.

Among the affected was Sasso, the French breeder of coloured free range birds. Director Louis Perrault recalls how the company had to eliminate all grandparent flock early in summer, even retrenching about 25 percent of their staff.

With losses from bird flu slashing first-half turnover by 50-percent and sales expected to close 20 to 25 percent lower this year, the outlook for 2007 remains unsure, says Perrault. As regulations following bird flu now dictate that all poultry must be raised indoors, this has created problems for both the free range producers as well as the birds, whom Perrault adds, do not perform well under confinement. Despite no reports of Sasso free range breeds contracting bird flu, the slump in company profits had much to do with media reports playing up the issue, he adds.

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