DAILY Bites
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A highly pathogenic avian influenza outbreak was confirmed at a Michael Foods third-party egg-laying facility in Iowa, impacting 4.5 million hens — 12% of Post Holdings’ controlled egg supply.
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Despite this, Post Holdings reaffirmed its fiscal year 2025 Adjusted EBITDA guidance of $1,41 million to $1,46 million, citing the incident as within anticipated financial tolerances.
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The outbreak highlights ongoing challenges for the egg industry, with 26 million hens affected by HPAI nationwide in 2024, contributing to supply disruptions and egg price volatility.
DAILY Discussion
Post Holdings Inc. has announced a confirmed case of highly pathogenic avian influenza at one of Michael Foods’ third-party contracted egg-laying facilities in Iowa. The facility, home to approximately 4.5 million hens, represents about 12 percent of Post’s controlled egg supply, encompassing owned and third-party operations.
Because HPAI is a flock-level disease, and any exposed birds would present a risk for continued transmission, the standard procedure is to euthanize all birds in an affected flock.
This is one of the first HPAI outbreaks reported in the Midwest this season, adding to an already difficult year for the egg industry. In 2024, the virus has caused significant losses, with approximately 26 million egg-laying hens impacted nationwide. The resulting disruption has been a key driver behind egg price volatility and fluctuations in supply.
The Iowa facility’s positive test highlights the ongoing challenges posed by HPAI, which can spread rapidly among densely populated flocks. Post Holdings has confirmed that it is working closely with the U.S. Department of Agriculture’s Animal and Plant Health Inspection Service and state authorities to address the situation.
Despite the outbreak, Post Holdings remains confident in its fiscal year 2025 outlook. The company reaffirmed its guidance for non-GAAP Adjusted EBITDA, projecting a range of $1,410 to $1,460 million. According to Post, the financial impact of the Iowa incident is expected to remain within tolerances factored into this forecast.
Post’s leadership emphasized that its ability to weather such disruptions is a result of diversified sourcing and robust operational planning. However, the company also noted that a significant expansion of HPAI within its supply chain could pose challenges, the impact of which remains uncertain.
The broader implications of avian influenza on the egg industry are substantial. Beyond the immediate loss of production capacity, outbreaks like this one contribute to higher operating costs for producers due to increased biosecurity measures, flock culling, and market instability. Consumers, in turn, often experience fluctuating egg prices at the grocery store.
While Post Holdings is unlikely to issue additional updates on individual incidents, it has stated that it will disclose further information if cumulative supply losses exceed 5 percent of its total controlled capacity.
Post Holdings’ ability to maintain its financial guidance in the face of such challenges demonstrates the company’s resilience. As one of the largest players in the packaged goods sector, Post operates across a range of categories, including cereals, peanut butter, refrigerated foods, and more. Its diversified portfolio, combined with strategic supply chain management, positions it to navigate volatile periods while continuing to meet market demands.
Although the Iowa outbreak underscores the ongoing risks associated with HPAI, it also highlights the importance of industry collaboration and innovation in mitigating the impact of such events. For now, Post Holdings remains focused on maintaining stability and delivering on its fiscal commitments.
