2294 part 1 final report.pdf - Agra CEAS Consulting

Prevention and control of animal diseases worldwide
Part I: Economic analysis: prevention versus outbreak costs
Nigerian Naria (N)
Market price (layer) (g) 700 5.49
Market price (broiler) (g) 1,000 7.85
(a) includes culling (value of culled animals and culling/disposal) and control costs
(b) FDLPCS official data (A169)
(c ) assuming disease continues on same course (as in the first 2 months) - the total number of poultry losses in the
first 2 months after outbreak first occurred (Feb 2006) was 440,000 (A258)
(d) on the basis of government announcement, compensation for culling only
(e) cost estimates per bird on the basis of destroying and disposing of 1000 birds per day by ad hoc organised teams
( A7)
(f) assumed to the double that of Vietnam as more costly to organise (for culling/disposal costs per bird ratio of
Vietnam to Nigeria was 4:1)
(g) range of current chicken market price (source: UNDP Nigeria, A293)
Exchange rate: 1USD = 127.4 Nigerian Naria (source: EIU)
Source: Agra CEAS Consulting, based on data from literature (including A7, A169, A258 and A293)
USD
5.3.4. Comparison of prevention versus outbreak costs
Although no cost-benefit analysis as such of Nigeria’s prevention and control strategies currently exists in
the reviewed literature, from a comparison of prevention to outbreaks costs significant conclusions can be
drawn.
The total budget of Nigeria’s national preparedness plan came to a total US$ 5.31 million excluding
stamping our and compensation in the event of an outbreak (Table 16). The animal health component of
the WB Integrated plan for HPAI control and eradication for 2006-10 comes to a total US$ 29.2 million
over the 5 year period (Table 17). Of this total, some US$ 6.59 million is earmarked for control (culling
and compensation activities) in the event of an outbreak. Excluding this provision, total prevention and
control activities as such (during ‘normal times’) come down to US$ 22.6 million. Other key components
include the strengthening of veterinary quarantine, which accounts for US$ 5.1 million over the 5 year
period, strengthening disease surveillance (US$ 4.95 million), and the establishment of a compensation
fund and economic recovery schemes for vulnerable farmers (US$ 9.8 million). Finally, the ALIVE
assessment (A258) gave estimates of the total animal health component for fighting AI in Nigeria at US$
40 million over a 10 year period.
Against these figures, the analysis of existing data suggests that direct costs of the 2004-05 HPAI
outbreaks (including culling and control costs, excluding consequential on-farm losses) amounted to US$
8.4 as at October 2006 (Table 19). It is noted that, unlike in the case of Vietnam, in Nigeria the economic
impact was not as high due to the relatively short timeline of these calculations. However, if projected on
a yearly basis, assuming the disease continued on the same course as in the first 2 months, then direct
costs could reach US$ 18.2 million. Our own estimates of a potential HPAI outbreak occurring in future
suggest that, under the scenarios and assumptions presented in section 6, Nigeria could face total direct
costs and losses (including consequential on-farm losses) of US$ 113 million a year (i.e. of a scale similar
to Vietnam). To these direct impacts are added the various indirect effects described in Table 18.
The comparison of the relative scale of the various prevention plans and needs assessments against the
actual and potential outbreak costs involved is depicted in Figure 14. It is noted that the WB control and
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