This is an extract from a major economic analysis of the options for FMD control published in the current issue ('Spring 2001') of the new magazine 'EuroChoices' published by the Agricultural Economics Society and the European Association of Agricultural Economists

Economic analysis of FMD control options

By Allison Burrell and Marie-Josee Mangen

"This is background to the EU's refusal to allow routine preventive FMD vaccination. However, excluding emergency vaccination as part of an epidemic control strategy overlooks the fact that, once an outbreak has occurred, disease-free status is already lost......soon after the UK outbreak began, a number of key foreign trading partners banned all susceptible imports from the EU as a whole. Thus, once disease-free status is lost, a non-vaccination policy becomes temporarily irrelevant......Are the costs of maintaining disease-free status without a more flexible attitude to vaccination becoming too high to justify?"

A non-vaccination policy is relevant to FMD-free status because a vaccinated animal may become infectious or sub-clinically infected (SCAH). Although tests are available for some species to distinguish between FMD-vaccinated and infected animals, their accuracy needs improvement. Only when a marker vaccine with a reliable diagnostic test becomes available will vaccinated animals be distinguishable from infected animals with near-certainty. FMD-free status is restored three months after the last infected a case, or the last vaccinated herd, has been slaughtered. Loss of disease-free status can have major economic consequences. For example, a ban on Dutch live pig exports in all export markets would lead to a total producer loss of euros 70m per month. If exports of pigmeat are also banned, the medium-run impact would be a contraction of the Dutch pig industry by over 50%. Of course, in the case of FMD), not only imports of live pigs and pigmeat, but also those of other susceptible livestock sectors, would be banned by FMD-free countries. This is background to the EU's refusal to allow routine preventive FMD vaccination. However, excluding emergency vaccination as part of an epidemic control, strategy overlooks the fact that, once an outbreak has occurred, disease-free status is already lost.

Within hours of FMD being confirmed in the UK and the Netherlands, emergency EU legislation was passed to prevent them from exporting within the Union any animals or products that might carry infection.

Moreover, soon after the UK outbreak began, a number of key foreign trading partners banned all susceptible imports from the EU as a whole. Thus, once disease-free status is lost, a non-vaccination policy becomes temporarily irrelevant.

The question is then whether targeted vaccination can shorten the duration of the epidemic, reduce its total costs and facilitate the return to disease-free status.

We investigated the extent and duration of 100 simulated epidemics that all began in the same way as the 1997-98 outbreak of classical swine fever in the Netherlands.

The simulations assume the same control measures as were actually used in the 1997-98 CSF outbreak. Farms where infected animals are detected have their entire herd slaughtered. After two months, slaughter of pigs within 1km of a detceted case begins ("protective slaughtering"). In both cases, compensation (at a standard rate) is paid for the slaughtered pigs but not for capacity left idle during the epidemic. Farms within a 10km movement standstill (MSS) area remain in production, but if their pigs are ready for market before the MSS is lifted, they are slaughtered ("welfare slaughtering") with compensation at the price in the disease-free zone, to avoid creating an incentive for smuggling pigs out of MSS areas.

The economic welfare effects of the epidemics were calculated under two different scenarios in which the policy slaughter and movement restriction (SMR) is implemented as described above. In the first scenario, producers outside MSS zones continue to trade. In the second scenario, export trade in live pigs stops.

With SMR only, the supply reduction is not matched by a fall in demand and so prices outside MSS areas rise. Hence, producers collectively gain and consumers lose. With an export ban, a segment of demand is removed from the Dutch market. When the epidemic is small, the fall in demand outweighs the reduction in supply due to movement restrictions, prices fall and so producers lose, but consumers gain. This effect is reversed in larger epidemics.

If appropriate ring-vaccination allowed an outbreak that would otherwise be "large" to remain "small" in scale, then the total welfare cost would be euros 297m, plus vaccination costs (about euros 3.5-4/pig, ie, euros 6-31 thousand for1km radius depending on pig density), plus compensation for additional preventive slaughtering (on top of welfare slaughtering) and extra vaccination costs if the vaccination ring extends further than the 1km preventive slaughter zone. This should be compared with the welfare effects of the "large" epidemic, namely euros 1,1193m.

There has been research into CSF to estimate the effects of using emergency vaccination within a 3km zone of each CSF infected farm in conjunction with SMR {with preventive slaughter beginning immediately.)

Emergency vaccination reduced the median duration of the epidemic from 164 to 108 days (measured over 100 simulations). For an "average" epidemic, total direct costs (implementation costs plus losses to the whole pig marketing chain) are similar in both cases, but for a large epidemic, costs are at least 43% lower for the with-vaccination scenario (177 days) than for the no-vaccination scenario (344 days).This is despite the assumption that vaccinated animals are subsequently slaughtered to accelerate the return to normal trading conditions.

Clearly, the direct costs depend crucially on the length of the epidemic. However, the full costs of an FMD epidemic go well beyond the cost of the control programme and the losses to agribusiness. Four weeks into the UK epidemic, the British press reported its total estimated costs as £9bn (1.1% of GDP), of which nearly 60% were losses to the tourist and leisure industry due to movement restrictions in the countryside (Sunday Times). These indirect costs are also strongly related to the duration of the epidemic and will rise proportionately with duration if the estimates are revised upwards.

In the case of FMD, research has shown that for Brittany, emergency vaccination in a 15km zone around uninfected farms, together with slaughter of infected or suspect animals, reduced duration by about 50% for a "small" (11.5 weeks) epidemic and by 85% for a "large" (39.5 weeks) epidemic.

Total costs to the Breton economy as a whole were 28%-39% higher with vaccination in the case of the small epidemic(depending on whether vaccination is implemented earlier or later), but 39%-43% lower in the case of the large epidemic.

By quantifying the gain from waiting for more information about the likely size of the epidemic, one can calculate the probability of a large-scale epidemic above which early vaccination would be the optimal strategy. Such fine-tuning of the emergency vaccination decision would need a sophisticated model to forecast the likely size of an epidemic at an early stage.

At the end of March, the EC allowed the Dutch government to use emergency FMD vaccination within a 2km radius of an infected farm, providing the vaccinated animals are slaughtered as soon as possible. The rationale for this measure is to gain time by reducing the amount of the virus circulating in the immediate vicinity of a detected case.

FMD vaccines can achieve a high level of immunity in vaccinated animals within a few days. By contrast, if preventive slaughter is required on a large scale logistic difficulties are likely to render slaughter and disposal too slow to be effective. It appears that lack of destruction and disposal capacity has severely hampered control measures in Great Britain.

However, given the huge potential costs in the worst-case scenario and the simulated effectiveness of strategic vaccination in shortening the duration of an epidemic, is 2km enough?

The evidence suggests emergency vaccination would be rational within a wider radius of a detected farm, and that the earlier this can be done the more likely it is that disease spread and economic costs will be minimised.

Most of the figures we have used to illustrate this logic relate to the Dutch pig sector and to a disease of lower infectivity than FMD.

In the case of FMD, the arguments are rein-forced. The direct costs of bringing an FMD epidemic using slaughter and movement restrictions alone would be much higher than in our examples. This is because the airborne range of the FMD virus is greater, its spread more rapid, and more species are susceptible to the virus.

Moreover, since all susceptible animal products (meat, dairy products) become potential vehicles of disease spread, the impact on the movement of food supplies and on agricultural trade would be far more severe for each animal type than for the pig sector in the case of CSF.

Furthermore, a major epidemic means severe restrictions on other economic activity and on personal mobility over large areas. The enormous economic and social cost of these restrictions is simply not justified by the potential for saving some extra direct costs. Moreover, the evidence suggests that this saving would be real only if the epidemic would have been small in any case.

Economic research indicates that once an epidemic threatens, rapid targeted emergency vaccination - as a temporary measure to stop further spread - is the lesser of two evils.

Our analysis has ignored ethical and animal welfare considerations, since these arguments are essentially unquantifiable. Clearly, they reinforce the case for acting to stifle the epidemic as quickly as possible.

In the coming months, some more fundamental questions should also be addressed. Restructuring of slaughtering capacity and opportunities offered by the EU's single market have greatly increased the movement of animals within and between EU member states.

Moreover, globalisation and increasing agricultural trade mean that tighter and more pervasive controls on imports and travellers could be needed to stop infectious animals diseases crossing EU frontiers.

Are the costs of maintaining disease-free status without a more flexible attitude to vaccination becoming too high to justify? And given that the EU's current large exportable surplus for livestock products is mainly due to support policies, which are themselves under pressure, how much should be spent to maintain export outlets for these surpluses?

Alison Burrell, is Associate Professor of Social Sciences, Waginingen University and Research Centre, Netherlands; Marie-Josee Mangen, PhD, is a researcher, financed by NWO-STW, Department of Statistical Sciences, Wageningen University and Research Centre, Netherlands.
All inquiries to Agricultural Economics Society (UK), Tel: 01825 765353, Fax: 01825 766945.