US embassy cable - 04HOCHIMINHCITY1258

UNCLAS SECTION 01 OF 02 HO CHI MINH CITY 001258 
 
SIPDIS 
 
SENSITIVE 
 
USDOC for 6500 and 4431/MAC/AP/OPB/VLC/HPPHO 
 
E.O. 12958: N/A 
TAGS: ECON, EAGR, SENV, PGOV, SOCI, VM, AFLU 
SUBJECT: RECURRENCE OF AVIAN FLU IN VIETNAM - WHERE'S THE CHICKEN? 
 
1.  (SBU) SUMMARY:  Both price and availability of poultry in 
southern Vietnam declined sharply during a five-month period 
following the March outbreak of avian flu, despite government 
efforts to reassure the public that avian flu is "under control." 
Vietnam has not replenished stocks of poultry and eggs from the 
widespread culling that occurred during the first outbreak of 
avian flu in December 2003, and farmers in the Mekong Delta have 
reportedly stopped raising chicken altogether.  As southern 
Vietnam has a significant poultry market, declining prices and 
scarce supply have suggested public concern about avian flu and 
avoidance of poultry.  During the past month, however, chicken 
prices in Hanoi, as well as in Ho Chi Minh City, have stabilized 
and in some cases risen slightly.  END SUMMARY. 
 
2. (SBU) According to widespread media reports, since Vietnam was 
proclaimed free of bird flu in March, 17 percent of the country's 
fowl population has been destroyed, equal to 43.2 million poultry 
in 57 out of 64 localities and a loss of VND 1.3 trillion ($83.3 
million).  International media sources were the first to report on 
fresh outbreaks of avian flu this summer and were the only 
consistent sources until August.  Local English language 
publications did not report any confirmation about avian flu from 
the Vietnamese authorities, or on any GVN response to avian flu, 
until August, at least three months after the recurrence of 
outbreaks.  Additionally, there was no media reporting on the 
avian flu recurrence in the Vietnamese language press until the 
end of July. 
 
3. (SBU) Government pronouncements reported in the national media 
have not been consistent.  During a working meeting with the FAO 
on July 14, the Director of Vietnam's Department of Animal Health 
(DAH), Dr. Bui Quang Anh, reportedly stated that there had been no 
new cases of bird flu in Vietnam since March 30.  Yet on July 19 
the DAH and the central government announced that an early July 
outbreak was "under control". Shortly after the July 19 
announcement, major newspapers carried front-page articles warning 
that avian flu had returned (from July 30 - August 2).  The media 
also reported that avian flu was again becoming a big concern, as 
the number of people reporting bird flu symptoms rose in 
localities having infected chickens. 
 
4. (SBU) Vietnamese media have been fairly muted since the initial 
July 19 announcement.  Newspapers now carry remarkably similar 
reports, quoting the same sources of information.  Not until 
August 13 did a major Vietnamese publication (Thanh Nien) carry 
the headline "Government confirms bird-flu returns."  Only a 
limited number of government officials are allowed to answer the 
press on the topic of avian flu.  ConGen media contacts claim that 
the GVN decided to follow Thailand's approach in dealing with the 
current avian flu outbreak.  In their view, Thai authorities 
downplayed last year's outbreak and Thailand's tourism industry 
suffered little while tourism to Vietnam fell sharply.  However, 
Dr. Bui of DAH warned the population at a September 1 press 
briefing in Hanoi that the HN51 virus could linger in the 
environment for at least five years after a fresh outbreak, adding 
that the flu could erupt again "anywhere", although he also 
announced that the current outbreak could soon be declared "under 
control". 
 
5. (SBU) Since the first avian flu outbreak both the supply and 
price of chicken have dropped substantially.  According to a 
report by the World Bank in Vietnam, "The Impact of the Avian 
Influenza Epidemic on the Vietnamese Economy," the price for a 
chicken was roughly VND 45,000 before December 2003.  Recent 
ConGen spot checks at local high-end markets indicate a price of 
around VND 30,000.  On September 17 and October 7, Econoff spoke 
with an expatriate retail grocer who sources chicken locally. 
According to the grocer, six months ago a whole chicken was priced 
at VND 78,000; currently, the grocer pays VND 35,000/chicken. 
Additionally, prior to avian flu this grocer sourced from only one 
local supplier.  Now the company sources from two or three 
suppliers due to short supply.  However, a wholesale supplier 
reported to HCMC Econoff on October 7 that wholesale chicken 
prices, which had also been declining, have gone up seven percent 
in the past month -- a phenomenon also observed for chicken prices 
in Hanoi during the same period. 
 
6. (SBU) Econoff also spoke with a local catering business about 
the price of poultry, as well as the price of beef, pork and fish. 
While chicken still remains a popularly requested menu item, the 
catering company reported paying a retail price around VND 
30,000/kilo.  The prices of beef, pork, and fish, however, have 
risen in the past six months:  beef from VND 55,000/kilo to VND 
65,000/kilo; pork from VND 27,000/kilo to VND 35,000/kilo; catfish 
from VND 30,000/kilo to VND 38,000/kilo; and black mullet from VND 
24,000/kilo to VND 30,000/kilo. 
 
7. (SBU) Poultry and poultry products are becoming far less common 
even in popular markets such as Ho Chi Minh City's Ben Thanh 
Market.  Falling demand and prices in recent months, combined with 
a fear of contracting the illness seem to be causing farmers to 
get out of poultry.  ConGen media sources report that only a 
handful of markets and supermarkets in HCMC are currently allowed 
to sell chicken meat.  (NOTE:  According to the Ministry of 
Agriculture in Hanoi, poultry meat is allowed to be sold 
throughout the country in both open markets and in supermarkets, 
but cities and provinces may implement their own regulations 
regarding the sale of poultry meat.  END NOTE.) 
8. (SBU) COMMENT:  In southern Vietnam, scarcity of poultry, 
declining poultry prices over a period of months, and mixed 
official media signals suggest a continuing public anxiety over 
avian flu and the difficulty the government has faced in assuaging 
that anxiety.  Recent reports of stable or increasing prices 
indicate that the local market may finally be correcting itself by 
matching diminishing supply with price increases.  END COMMENT. 
 
WINNICK