By Grey Moran for Sentient.
Broadcast version by Trimmel Gomes for Mississippi News Connection reporting for the Sentient-Public News Service Collaboration

As avian flu rapidly circulates in the U.S., Cal-Maine Foods, the nation’s largest egg producer, appears to be having a bumper year, bolstered in part by taxpayer bailouts in the multi-millions.

The company’s stocks recently soared to a record high, as its net sales rose by a staggering 82 percent last quarter. Cal-Maine Foods expanded its operations last spring, paying around $110 million in cash to acquire the assets and facilities of another egg producer, ISE America. Despite culling at least 1.6 million hens on infected farms last year, the poultry corporation is getting richer and bigger

U.S. taxpayers have given the poultry giant a lift. The company has received $44 million in indemnity payouts to compensate for bird deaths tied to the avian flu outbreak. Despite the company’s growth, Cal-Maine Foods is the fourth largest recipient of indemnity payments for the ongoing outbreak from the U.S. Department of Agriculture’s Animal and Plant Health Inspection Service (APHIS)’s indemnity program.

The compensation system, distinct from the agency’s program for livestock, pays poultry farmers and producers for the market value of the birds and eggs. It does not pay for birds that directly die from avian flu. It only pays for “infected or exposed poultry and/or eggs that are destroyed to control the disease,” — i.e. deliberately killed to prevent the spread of the virus. The agency also provides compensation for other virus control activities, such as destroying contaminated supplies and disinfecting a barn after an outbreak.

Nearly three years since the first H5N1 outbreak in U.S. poultry, the USDA has concluded that the agency’s compensation system has not worked as it intended. By bailing out poultry producers with few stipulations, the system has, inadvertently, lowered the economic risk of biosecurity lapses on farms, encouraging the virus’s spread. In other words, farmers have not been effectively incentivized to make changes to protect their flocks.

As the outbreak has continued to spread, the government bailout of the poultry industry has ballooned too. As of January 22nd, 2025, APHIS has doled out $1.46 billion in indemnity payments and additional compensation over the outbreak’s course, according to a figure provided to Sentient by a USDA spokesperson. This includes $1.138 billion for the loss of culled eggs and birds and $326 million for measures to prevent the virus’s spread.

A significant share — $301 million — of the indemnity payments have gone to just the top four producers, according to government spending data.

Jennie-O Turkey Store, based in Minnesota, tops the list for indemnity payouts: the popular turkey brand has received $120 million since the beginning of the H5N1 outbreak in 2022, according to government spending data. Herbruck’s Poultry Ranch, which supplies McDonald’s cage-free eggs, has received the second largest bailout at $89 million. Center Fresh Egg Farm, part of a group of farms owned by Versova, one of the largest U.S. egg producers, has received $46 million. (This data reflects the legally obligated amount of indemnity owed to each company, which means that the USDA may not have dispensed these payments in full yet.)

By comparison, when the first outbreak of avian flu swept the U.S. between 2014 and 2015, farmers and producers received just over $200 million in indemnity payments.

“The current regulations do not provide a sufficient incentive for producers in control areas or buffer zones to maintain biosecurity throughout an outbreak,” APHIS stated in December, which introduced new emergency guidelines in an attempt to remedy this incentive problem. 

One of the preferred methods farms use to cull birds is by sealing off the air flow to the barn and then pumping in heat or carbon dioxide. Known as Ventilation Shutdown Plus (VSD+), this is a cheap way to kill an entire flock by heat stroke or suffocation, and is approved by the USDA for indemnity payments only under “constrained circumstances.” The top 10 recipients of indemnity payments all used VSD+ to often exterminate millions of birds at once, according to APHIS records obtained by Crystal Heath, a veterinarian and the executive director of Our Honor, through a FOIA request.

By compensating farmers for VSD+, this system has helped make what many animal welfare advocates consider an unnecessarily cruel death part of the industry standard.

The American Veterinary Medical Association (AVMA) recently released a draft of new guidelines for depopulation, which notes when the heat fails, VSD+ can result in an “unacceptable numbers of survivors” — birds that are severely injured, but not yet dead, and then need to be killed by another means. Yet the AVMA’s draft guidelines, closely relied upon by the USDA, still include this method as an option.

Some animal protection advocates contend that poultry companies should not receive indemnity payments at all, regardless of biosecurity, arguing that the industry should be responsible for its own losses.

“Why should this high-risk business be bailed out?” Heath, a longtime critic of AVMA’s guidelines, tells Sentient. As an animal protection advocate, Heath has also been closely tracking indemnity payments throughout this outbreak. “What we’re seeing is the largest corporations are receiving the most in indemnity payments, and they’re using the most brutal methods of depopulation,” referring to the culling methods.

The bailout is set to only expand as H5N1 spreads, prompting the mass culling of more domestic flocks, in what has become the largest foreign animal disease outbreak in U.S. history. The egg industry continues to be roiled: over 20 million egg–laying chickens died from either culling or the virus in the final quarter of last year.

More recently, on January 17, 2025, HPAI was detected for the first time in a commercial poultry flock in Georgia, the top producer of poultry in the U.S., deepening concerns about the struggle to contain the prolonged outbreak.

Too Indemnified to Fail: How Payments Can Incentivize Risk

The indemnity system was designed to incentivize producers to adopt practices that help curb the spread of the virus. As APHIS states, the payments are intended to “encourage prompt reporting of certain high consequence livestock and poultry diseases and to incentivize private biosecurity investment.” Biosecurity measures include a range of practices to prevent disease outbreaks, from latching dumpster lids and disinfecting equipment to more expensive measures, like installing netting and screens on barns to deter wild birds.

These biosecurity measures are especially critical given that H5N1 is most commonly introduced to poultry flocks through wild birds, according to a 2023 epidemiology analysis conducted by APHIS. The virus’s transmission from wild birds can happen either directly, or indirectly through contaminated feed, clothing and equipment.

By sheltering producers from risk, researchers have observed that indemnity payouts can, under some circumstances, inadvertently encourage lapses in biosecurity, enabling the spread of disease. And this can potentially create a system where farms are too indemnified to fail — the risks of operating a business highly susceptible to disease are absorbed by the government.

“What we are finding is that ‘unconditional indemnity’ disincentivizes livestock producers to adopt biosecurity because they know that if the disease strikes their system then they would be indemnified,” Asim Zia, a professor of public policy and computer science at the University of Vermont who researches livestock disease risk, tells Sentient. According to Zia, “unconditional indemnity” means indemnity payments with next-to-no requirements to qualify.

It remains to be seen whether APHIS’s new interim guidelines — which will require that some high-risk producers successfully pass a biosecurity audit prior to receiving indemnity — will be enough to remedy this issue and encourage producers to change. Unlike the previous system, the new audits will include a visual inspection of the premises, either virtually or in-person. However, the scope of the new rule is limited to large-scale commercial poultry facilities that have been previously infected with HPAI, or that are moving poultry onto a poultry farm in a “buffer zone,” a higher-risk region.

Other large-scale commercial facilities will still follow the earlier rule’s more lenient audit process. This requires an audit of a producers’ biosecurity plan on paper — not an inspection of the actual poultry farm — every two years. It has been remarkably easy for farmers to pass this audit: the failure rate of this program was zero, according to APHIS, which made it so there were effectively no strings attached to the payouts. And smaller-scale poultry operations are entirely off the hook, exempt from both rules, and even from developing a biosecurity plan.

In the past, APHIS has repeatedly bailed out many of the same poultry businesses, spending $227 million on indemnity payments to farms that have been infected with H5N1 multiple times. This has included 67 poultry businesses that have been affected at least twice, and 19 companies that have been infected at least three times, according to the agency’s own records.

APHIS has not released the names of the companies that have been repeatedly infected, though the indemnity payments provide a glimpse into this.

Take Cal-Maine Foods’ poultry farm in Farewell, Texas. On April 2, 2024, Texas’s Commissioner of Agriculture Sid Miller announced its flock tested positive for H5N1, requiring the culling of 1.6 million laying hens and 337,000 pullets. The very next day Cal-Maine Foods, headquartered in Mississippi, received an indemnity payment of $17 million for HPAI detected on the Texas operation, according to government spending data.

The Poultry Industry’s Risky Expansion

Last November, Cal-Maine Foods’ executives joined other business leaders across industries at an annual investment conference, ringing in the year on an optimistic note. As avian flu decimated flocks, the company’s top executives were focused on the future.

“We still think there’s going to be good opportunity to grow,” Max Bowman, Cal-Maine Foods’ vice president and CFO, told business leaders. “We got a playbook for the whole market. And so right now, things are great, but we think we can continue to build this company,” which, as it stands, controls one-fifth of the domestic egg market in the U.S.

The company is already in the process of building five new cage-free facilities, adding 1 million hens to their flock, in Florida, Georgia, Utah and Texas.

Bowman, Cal-Maine’s Vice President, did not reply to Sentient’s request for comment.

Other poultry companies are expanding too. For instance, Demler Farms in San Jacinto, California is building a triple-story egg operation right next to a dairy farm, which is also susceptible to the avian flu now that it has spread to cattle. Adding to this risk, the San Jacinto Valley is a critical habitat for migratory water birds, the primary hosts of avian flu.

Most of California’s cases of avian flu in poultry have been clustered along this water bird migratory route, known as the Pacific Flyway. Yet this appears to not be enough of a deterrent for Demler Farms’ expansion. As Heath observed, this risk is softened by the indemnity payment system, ready to bail out infected poultry farms by the millions.


Grey Moran wrote this article for Sentient.


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By Seth Millstein for Sentient.
Broadcast version by Suzanne Potter for California News Service reporting for the Sentient-Public News Service Collaboration

In 2018, California voters passed the strongest animal protection law in the country, and it’s been under near-constant attack ever since. After surviving a Supreme Court challenge and multiple legislative assaults, Proposition 12 now faces a new threat: the Food Security & Farm Protection Act, a new piece of legislation that was announced last week.

The GOP-sponsored bill is explicitly aimed at undoing Proposition 12, which requires farmers to give certain livestock animals a specific amount of space on their facilities. However, experts say that it could also potentially threaten over 1,000 public health, safety and welfare laws across the country.

While the Food Security & Farm Protection Act itself is new, the approach to undoing Prop 12 isn’t. “This has been the Big Ag playbook for quite a while, and it’s taken various legislative forms,” Rebecca Wolf, senior food policy analyst at the nonprofit Food and Water Watch, tells Sentient. “Big Ag doesn’t want to be told what to do by states, and so it puts Republicans in a really interesting position that puts them between Big Ag and more of a states’ rights framework.”

But some Republicans strongly oppose this latest attempt to repeal Proposition 12, and so do a lot of farmers. Politics makes for strange bedfellows, and the fight over Proposition 12 is a perfect illustration of why.

Proposition 12, Explained

Initially passed by California voters in 2018, Proposition 12 is a state law that regulates the conditions in which certain livestock are reared, and additionally, the type of livestock products that can be sold in the state. Both components of the law are centered on how much room the animals are given to live.

Proposition 12 imposes minimum space requirements for breeding pigs, egg-laying hens and veal calves. Breeding pigs must be given at least 24 square feet of floor space, while egg-laying hens must be given between 1 and 1.5 square feet of space, depending on the type of housing system. Veal calves are required to be given 43 square feet of space.

In addition, Proposition 12 requires that all food sold in the state of California adheres to the above requirements, even if it was produced in another state. Because California is such an enormous market for eggs and pork, this second provision has resulted in many out-of-state producers, including some in other countries, adapting to Proposition 12’s requirements.

Although Proposition 12 is widely regarded as the strongest animal welfare law in the country, there’s a lot that it doesn’t do. The law’s protections don’t apply to chickens raised for meat, for instance, or cattle, nor does it place any restrictions on how the animals are slaughtered. In addition, Proposition 12 doesn’t regulate tail-docking, beak trimming and many other practices that are commonplace on factory farms but not strictly related to living space.

The Fight to Repeal Proposition 12

The Food Security and Farm Protection Act is the most recent attempt to scrap Proposition 12, but it’s definitely not the first.

   The King Amendment

Way back in 2013, before Proposition 12 was even on the ballot, Rep. Steve King proposed an amendment to that year’s farm bill that would have banned states from imposing their own restrictions on the in-state sale of agricultural products produced out of state. This was in response to earlier state laws that enacted such restrictions, such as California’s Proposition 2.

Ultimately, Congress didn’t include the King Amendment in that year’s farm bill. But King resurrected his amendment five years later, as California voters were preparing to weigh in on Proposition 12. As with the previous attempt, it was initially approved in committee; months later, however, California voters approved Proposition 12, and one month after that, the King Amendment was defeated on the House floor.

   The Supreme Court Case

The next year, several meat industry lobbying groups sued to overturn Proposition 12, including the North American Meat Institute and, in a separate lawsuit, the National Pork Producers Council and the American Farm Bureau Federation. The former suit was quickly defeated, but the latter made its way up to the Supreme Court.

These trade groups argued that Proposition 12 was unconstitutional on two grounds. First, they claimed that it violated a legal doctrine known as the dormant commerce clause. This is the idea that, because the Constitution allows Congress to regulate interstate commerce, states can’t pass laws that substantially encroach on this congressional duty.

The plaintiffs also argued that the purported benefits of Proposition 12 to Californians didn’t outweigh the economic burden that it placed on other states’ economic interests. Nevertheless, the Supreme Court rejected both arguments, and Proposition 12 went into full effect in 2024.

   The EATS Act

Perhaps in anticipation of this, Sen. Roger Marshall of Kansas then introduced the EATS Act. It was essentially the same as the King Amendment, and followed a similar path: Republicans included it in their 2024 farm bill proposal, but it never passed or became law. This is largely because the 2024 farm bill itself never passed, but that’s another story entirely.

Although the EATS Act is kaput, many supporters of Proposition 12 still use “the EATS Act” as a colloquial way of referring to the most recent piece of legislation that would repeal the California law.

This time, it’s the Food Security & Farm Protection Act.

The Complicated Coalitions Behind Proposition 12

It might be tempting to assume that liberals support Proposition 12, and conservatives oppose it. But in practice, opinions on the law haven’t mapped neatly on to traditional partisan lines, and it’s drawn both support and opposition from some surprising places.

   Animal Welfare Groups

Generally speaking, supporters of animal welfare and opponents of factory farming support Prop 12. The Humane Society, Animal Legal Defense Fund, ASPCA, Animal Welfare Institute, The Humane League and many other animal rights organizations have all gone to bat for the law, and so have a good number of climate and environmental organizations, such as the Center for Biological Diversity, Friends of the Earth and National Sustainable Agriculture commission.

“We want to see the standards raised for all animals on factory farms, and we want to see a roll away from factory farms,” Wolf says.

And yet one of the most well-known animal rights groups, People for the Ethical Treatment of Animals (PETA), has opposed Proposition 12 from the start, and so has the Humane Farming Association (HFA). PETA’s position is that the law doesn’t go far enough and would be misleading to consumers, while HFA essentially doubted that Proposition 12 would be properly implemented.

   Agricultural Lobbies & Farmers

On the other side, major agricultural lobbies have long opposed Proposition 12. This includes the National Pork Board as well as the Meat Institute, the American Farm Bureau Federation and the National Pork Producers’ Council. Smithfield Foods, the largest pork producer in America, has complained about Proposition 12 and suggested that it supports repeal, without stating so explicitly.

And yet despite this, many individual farmers support Proposition 12 for a variety of reasons. Some simply agree with the idea of giving farm animals a little bit more space, while others like that they can sell Proposition 12-compliant meat and eggs at a premium to welfare-minded customers. One farmer told Sentient last year that the law is “one of the best things, economically, that’s happened to us in a very long time.”

“Within the food and farm marketplace, there are places for producers to carve and make investments, and provide the product that the market is asking for,“ Wolf says. Proposition 12, she says, makes it easier for “independent producers [to] carve this niche, and form higher-welfare markets” for pork and eggs.

Why Republicans Are Divided on Attempts to Repeal Prop 12

All of the legislative attempts to repeal Proposition 12 have come from Republican lawmakers. And yet a surprising number of Republicans have come out in support of Proposition 12 — or at the very least, against the efforts to repeal it. This may sound like a small distinction, but it’s played a big role in shaping some folks’ opinion on the law, especially on the right.

In 2023, 16 House Republicans signed a letter declaring their opposition to the EATS Act and its inclusion in the farm bill. These lawmakers said that, while they didn’t necessarily support Proposition 12 itself, they very much did oppose the idea of the federal government overturning state laws, which is what the EATS Act, and now the Food Security & Farm Protection Act, would do.

“The EATS Act is a pretty draconian federal preemptive strategy that tells states how to regulate within their borders,” Wolf says. “That is pretty antithetical to a lot of the major talking points of the Republican Party.”

This is also the position of Texas Agriculture Commissioner Sid Miller, a conservative Republican who opposes both Proposition 12 and the attempts to repeal it. In 2024, Miller wrote in an op-ed that, “while I don’t agree with Proposition 12, I’ll defend to my dying day California’s right to self-determination, and any state’s ability to use its constitutional authority as that state’s citizens best see fit.”

In addition to this reasoning, some conservative Republicans also support Proposition 12 because they see it as a bulwark against foreign influence over American farmland. This is largely because the biggest pork producer in America, Smithfield Foods, is owned by a Chinese company with strong ties to the Chinese government. China has scant animal welfare laws, but any meat that Smithfield’s parent company sells in California has to be Proposition 12-compliant.

Many conservatives oppose Smithfield’s Chinese ownership, seeing it as a threat to national security, the livelihood of American farmworkers, and animal welfare. These concerns vary in terms of their validity, but regardless, 10 House Republicans signed a letter stating that they oppose the EATS Act on these grounds.

The Bottom Line

It’s far too soon to say what will come of the Food Security & Farm Protection Act. While Republicans have the majority in Congress, they’re divided enough on Prop 12 that attempts to overturn it are anything but certain. But like the EATS Act and the King amendment before it, the legislation’s mere existence is evidence of Proposition 12’s enormous impact on the farming sector. So, too, is the fact that it’s supported by such a wide variety of people, for so many different reasons.

“There’s a ton of these different conversations about the kind of food and farm system that we’re building,” Wolf says. “It’s not just about animal welfare standards, but the infrastructure under which food production happens today.”


Seth Millstein wrote this article for Sentient.


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Rising egg prices have some wondering if raising backyard chickens could save money, but experts warn that this may not be a money-saving option.

The ongoing outbreak of highly pathogenic avian influenza, a dangerous strain of bird flu, has resulted in the loss of more than 100 million hens nationwide.

Dr. Tom Tabler, poultry extension and research specialist at the University of Tennessee's Institute of Agriculture, said backyard chickens are a good idea but they're costly and won't save you money on eggs. He said they add many expenses and take time to start laying eggs.

"A chicken is not going to lay eggs till she becomes sexually mature, and that's going to be - depending on what breed of chicken that is - that's going to be somewhere between about 19 weeks of age and 24 weeks of age," he said. "If you get baby chicks, you're going to have to raise those chickens for six months before you start getting any eggs."

Tabler said those buying adult chickens should make sure they're disease-free. He recommended getting them from sellers in the National Poultry Improvement Plan, which follows standards to ensure the birds are healthy.

Tabler said egg prices have remained high because bird flu has killed about 168 million birds since 2022; around 100 million of them were egg-laying hens. More than half of those losses happened just between October 2024 and last February, right in the middle of the holiday baking season.

"I really don't expect egg prices to seriously come down until maybe next year at the earliest," he said, "because again, it's going to take time to replace the lost flocks, and if we continue to lose table egg flocks, later into the year, those birds also have to be replaced."

Tabler said there's no vaccine yet for bird flu, although some companies are working on one. He said the best defense is to keep birds isolated, limit human interaction and make sure they are in a clean and sanitary environment.

By Grace Hussain for Sentient.
Broadcast version by Terri Dee for Indiana News Service reporting for the Sentient-Public News Service Collaboration

Egg producer Kipster recently announced it had failed to meet what was an ambitious goal - ending the practice of male chick culling in its U.S. supply chain, a practice responsible for culling six billion male chicks globally each year. The Dutch-based company had hoped to implement a technology called in-ovo sexing to eliminate this practice by fall of last year. But it hit a few roadblocks.

"We've been really trying hard to work with the technology provider and hatchery to get it to the United States," Sandra Vijn, who manages Kipster's U.S. operations, tells Sentient.

And there were other promising signs. Earlier this month, Walmart updated its animal welfare policies to prioritize "gendering innovation" within their egg supply chain, for instance. But the process is taking longer than expected.

Male chicks have long been considered a by-product by the egg industry because they don't lay eggs and they don't grow fast or large enough to compete with meat chickens. It's standard practice within the industry to kill them right after they hatch; approximately six billion male chicks are killed each year globally.

In-ovo technology eliminates the need to cull live, male chicks by determining whether the embryo developing inside the egg is male or female before they hatch. The male eggs are then discarded before they can finish developing. There are other alternative technologies being investigated by researchers too, like using genetic engineering to breed hens that only lay female eggs.

Still, the company is moving forward. Respeggt, a technology company that works with Kipster on the in-ovo technology, announced that their in-ovo sexing technology would be installed in the Nebraska hatchery that Kipster sources from this month. Vijn now expects to get sexed eggs from the hatchery sometime this summer. From there, it will take about 20 weeks for the hens to mature enough to start laying eggs, which the company expects to hit the market by late 2025.

Kipster Sees In-Ovo Sexing As a Temporary Solution

In-ovo sexing was not Kipster's first choice for the American market. The company wanted to take the production system that they use in the Netherlands - where male chicks are raised to be sold for meat - and replicate it in the U.S., says Vijn.

But that plan hit a snag. "We couldn't get a processor to work at the scale and price that we could afford," says Vijn. Instead of being sold for meat, the four flocks of adult roosters they had raised at their U.S. facility ended up being slaughtered, and their carcasses were donated to food banks.

For Vijn, raising male chicks for meat is preferable, as it cuts down on both waste and animal suffering. "We think that everything within our farm is a good source of food for people," she says. "With every rooster that can be eaten, there's less need to bring additional broiler chicks to life."

Ultimately, says Vijn, "we were looking at in-ovo as a temporary solution."

Satisfying the American Consumer

In the Netherlands, where Kipster was founded, consumers are willing to pay a premium for meat from chickens who had basic welfare accommodations - such as access to the outdoors - during their lives.

Since last year, all fresh chicken meat sold in Dutch grocery stores comes from slower-growth breeds of broiler chicken. Like their Dutch counterparts, consumers in the United States are also willing to pay extra for animal products - including up to 38 percent more for eggs according to a 2018 survey - that they believe were produced under higher welfare conditions.

A key difference between the two countries is that in the Netherlands, consumers buy and eat the rooster meat from layer chicken breeds, says Vijn. In Europe, Kipster also sells their spent hens - those who are no longer considered productive egg layers - for human consumption.

Consumers in the U.S. aren't so open to the idea, however. In the United States, the hens are sold for pet food.

In the U.S., Kipster raises Dekalb white chickens, a breed specifically bred to lay eggs, up to 500 in 100 weeks. Dekalb white chickens start laying eggs at around 18 weeks of age, weighing in at a little over 1300 grams.

Research has found that the high number of eggs they lay weakens their bones, making laying hens highly susceptible to bone fractures. Dekalb white chickens are especially vulnerable to these breaks.

Ultimately, the delay in bringing the technology to the United States came down to an issue of scale. Respeggt and Hendrix needed to know that there would be enough of a market for the sexed eggs. "The equipment we have is made to produce large numbers of female eggs, and acceptance from retail, and farmers took some time," Respeggt's representative told Sentient.

Sentient reached out directly to Neal Martin, General Manager of Hendrix ISA-U.S., a subsidiary of Hendrix Genetics, for comment and did not receive a reply.

For Kipster, adopting in-ovo technology remains a viable, albeit second-best option. "It really fits in our philosophy that we should be eating less eggs, less meat, less animal proteins," Vijn says, "but already use whatever is in the system so that we don't have to bring a life on earth just for the purpose of eating them."


Grace Hussain wrote this article for Sentient.


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