Human epidemics are a constant threat on factory farms

Standard factory farming conditions including close confinement of animals indoors, unsanitary conditions, poor air quality, and untreated animal illness, injury, stress, and death combine to increase the likelihood and spread of infectious disease among farmed animals. At least some of these diseases are zoonotic, meaning they are transmissible to humans. According to the World Health Organization (WHO), zoonotic diseases represent at least 61% of total human pathogens and 75% of novel pathogens that have emerged since the mid-1990s.[14] In January 2020, Chinese health authorities identified the novel pathogen that has since become known as COVID-19. Believed to have originated in bats and infected humans via contact with bats or other animals in a live animal market in Wuhan, China, the deadly virus swiftly spread to nearly every country in the world.[15] 

Nearly a century after the 1918 H1N1 avian influenza killed 50 million people, deadly infectious diseases continue to emerge from intensive agriculture operations. Since the mid 1980s alone, several have caused outbreaks among animals and humans and remain persistent threats to each. Creutzfeldt-Jakob (“mad cow”) disease (1986), H5N1 avian flu (1997), severe acute respiratory syndrome (SARS, 2003), H1N1 swine flu (2009), and H7N9 avian flu (2013) all spread among animals on factory farms before sickening and killing hundreds of thousands of people. 

COVID-19 is the latest infectious disease to emerge from industrialized animal agriculture operations. And if this disease has taught investors anything, it is that zoonoses pose grave risks not only to human populations but also the global economy. As of early August 2020, COVID-19 had infected nearly 20 million people worldwide, killing more than 730,000, and, according to the World Bank, “plunging” the global economy into the deepest recession since World War II.[16] In the United States, more than 5 million had contracted the virus, and over 160,000 had died. The Dow, NASDAQ, and S&P 500 had all experienced historic losses, and the country had entered a recession after plummeting a record 32.9% during the second quarter.[17] 

COVID-19 has had a devastating financial impact on the factory farming industry. The rampant spread of the disease among slaughterhouse workers forced plant closures around the world. Meat industry giants JBS, Maple Leaf, National Beef Packing Company, Perdue, Sanderson, Tyson, and Smithfield were all among the companies forced to suspend slaughterhouse operations. In response, Tyson CEO John H. Tyson placed a full-page ad in the April 26, 2020 edition of the New York TimesWashington Post, and Arkansas Democrat-Gazette warning readers “the food supply chain is breaking” as factory farmers were killing millions of chickens, pigs, and cattle they could not send to slaughter.[18] Although the closures increased meatpackers’ expenses while also diminishing their profitability and share prices, Smithfield CEO Kenneth Sullivan emphasized the negative implications of the shutdowns for contract factory farmers. “These facility closures will also have severe, perhaps disastrous, repercussions for many in the supply chain, first and foremost our nation’s livestock farmers,” he noted in the wake of the company’s decision to indefinitely shutter a South Dakota plant where nearly 20 percent of its 3,700 employees had contracted COVID-19.[19] 

According to the USDA, COVID-19 hit the U.S. livestock commodity sector hardest. Between January and mid-April 2020, hog prices fell by 53.2%, a decline outpaced only by crude oil’s at 67.1%. The swine industry suffered an estimated $5B in losses as a result. Cattle prices fell by 25.1% during this period, resulting in an estimated $13.6B to $14.6B in losses for the cattle/beef industry, while the price of Class III milk was down 20.6%, translating into $8B in losses for dairy producers.[20]

On April 28, 2020, U.S. President Donald J. Trump issued an executive order declaring slaughterhouses “critical infrastructure” in an effort to keep the facilities open and operating despite continued COVID-19 outbreaks.[21] The Trump Administration also authorized record levels of aid to factory farming operations, including by earmarking $9.5B of the CARES Act for factory farming’s most vulnerable sectors: cattle, dairy, and swine. As of mid-2020, nearly 70% of all CARES payments had gone to factory farming operations in these sectors.[22] But few factory farming operations expect the payments will guarantee they can return to business as usual. As the Iowa-based Titan Swine explained to NBC News, its $2.5M Coronavirus Food Assistance Program (CFAP) payment will not come close to covering its ~$6M in COVID-related losses.[23]

As of June 30, 2020, farming-operation bankruptcy filings had increased 8% over 2019, a nine-year high.[24] (According to the American Farm Bureau Federation, 2019 bankruptcy filings increased 24% over 2018.[25]) The dairy industry has been hardest hit, including by the late 2019 and early 2020 financial collapses of Dean Foods and Borden Dairy Company. But COVID-19’s significant negative impacts have combined with global trade disruption, the rise of alternative meat and dairy products, and record levels of farm debt to put all factory farming operations at increased risk of collapse.[26] 

In late June 2020, scientists identified a novel strain of swine flu called “G4” among pigs in China. The virus, they warned, had “human pandemic potential.”[27] Describing G4 as “especially concerning” given that the pathogen combines elements of mammalian and avian flu strains to which humans have no natural immunity, one UK biologist warned the virus “is poised to emerge in humans” and that the situation “needs to be monitored very closely.”[28] Emphasizing the importance of maintaining a constant awareness of the possibility another zoonotic disease will emerge from animal-based operations to cause a global health crisis, a scientist from the National Institutes of Health (NIH) noted, “We need to be vigilant about other infectious disease threats even as COVID is going on because viruses have no interest in whether we’re already having another pandemic.”[29]

Footnotes and sources

[14] World Health Organization, “Neglected Zoonotic Diseases,” accessed June 5, 2020, https://www.who.int/neglected_diseases/diseases/zoonoses/en/.

[15] Al Jazeera, “Which countries have not reported any coronavirus cases?” July 15, 2020, accessed July 20, 2020, https://www.aljazeera.com/news/2020/04/countries-reported-coronavirus-cases-200412093314762.html.

[16] The World Bank, “COVID-19 to Plunge Global Economy into Worst Recession since World War II,” June 8, 2020, accessed August 9, 2020, https://www.worldbank.org/en/news/press-release/2020/06/08/covid-19-to-plunge-global-economy-into-worst-recession-since-world-war-ii.

[17] Marketwatch, “As Dow wipes out over 3 years of stock-market gains, here’s a warning about calling the bottom,” March 25, 2020, accessed June 1, 2020, https://www.marketwatch.com/story/as-dow-wipes-out-over-3-years-of-stock-market-gains-heres-a-warning-about-calling-the-bottom-2020-03-21; Jeanna Smialek and Alan Rappeport, “The US Entered a Recession in February,” New York Times, June 8, 2020, accessed June 15, 2020, https://www.nytimes.com/2020/06/08/business/economy/us-economy-recession-2020.html; Dale Smith, “Coronavirus recession: How bad it could get and what it means for you,” Cnet.com, July 31, 2020, accessed August 9, 2020, https://www.cnet.com/personal-finance/coronavirus-recession-how-bad-it-could-get-and-what-it-means-for-you/.

[18] John H. Tyson, “A Delicate Balance,” Washington Post, April 26, 2020, accessed August 5, 2020, https://www.washingtonpost.com/context/tyson-ad/86b9290d-115b-4628-ad80-0e679dcd2669/.

[19] Lisa Johnston, “With Closure of Pork Plant, Smithfield Warns of Supply Chain Repercussions,” Consumer Goods Technology, April 14, 2020, accessed August 5, 2020, https://consumergoods.com/closure-pork-plant-smithfield-warns-supply-chain-repercussions.

[20] Congressional Research Service, “COVID-19, U.S. Agriculture, and USDA’s

Coronavirus Food Assistance Program (CFAP),” May 8, 2020, accessed August 8, 2020, https://crsreports.congress.gov/product/pdf/R/R46347.

[21] Ana Swanson and David Yaffe-Bellany, “Trump Declares Meat Supply ‘Critical,’ Aiming to Reopen Plants,” New York Times, April 28, 2020, accessed August 8, 2020, https://www.nytimes.com/2020/04/28/business/economy/coronavirus-trump-meat-food-supply.html.

[22] USDA, “Coronavirus Food Assistance Program Data,” accessed August 8, 2020, https://www.farmers.gov/cfap/data; Kit Ramgopal and Andrew W. Lehren, “Small farmers left behind in Trump administration's COVID-19 relief package,” NBC News, August 9, 2020, accessed August 9, 2020, https://www.nbcnews.com/business/economy/small-farmers-left-behind-trump-administration-s-covid-19-relief-n1236158.

[23] Kit Ramgopal and Andrew W. Lehren, “Small farmers left behind in Trump administration's COVID-19 relief package,” NBC News, August 9, 2020, accessed August 9, 2020, https://www.nbcnews.com/business/economy/small-farmers-left-behind-trump-administration-s-covid-19-relief-n1236158.

[24] Jesse Newman, “More Farmers Declare Bankruptcy Despite Record Levels of Federal Aid,” Wall Street Journal, August 6, 2020, accessed August 8, 2020, https://www.wsj.com/articles/more-farmers-declare-bankruptcy-despite-record-levels-of-federal-aid-11596706201?mod=searchresults&page=1&pos=1.

[25] John Newton and the American Farm Bureau, “Farm Bankruptcies Rise Again

Chapter 12 Filings Increase 24% Compared to Year-Ago Levels,” October 30, 2019, accessed August 7, 2020, https://www.fb.org/market-intel/farm-bankruptcies-rise-again.

[26] Farm Aid, “Understanding the Economic Crisis Family Farms are Facing,” October 8, 2019, accessed August 8, 2020, https://www.farmaid.org/blog/fact-sheet/understanding-economic-crisis-family-farms-are-facing/.

[27] Jon Cohen, “Swine flu strain with human pandemic potential increasingly found in pigs in China,” ScienceMag.org, accessed July 18, 2020, https://www.sciencemag.org/news/2020/06/swine-flu-strain-human-pandemic-potential-increasingly-found-pigs-china.

[28] Jon Cohen, “Swine flu strain with human pandemic potential increasingly found in pigs in China,” ScienceMag.org, accessed July 18, 2020, https://www.sciencemag.org/news/2020/06/swine-flu-strain-human-pandemic-potential-increasingly-found-pigs-china.

[29] Jon Cohen, “Swine flu strain with human pandemic potential increasingly found in pigs in China,” ScienceMag.org, accessed July 18, 2020, https://www.sciencemag.org/news/2020/06/swine-flu-strain-human-pandemic-potential-increasingly-found-pigs-china.