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UPDATE 2-Bird flu found in Indiana; 15th state to report it

(Adds comments from USDA, details on economic impact)

By P.J. Huffstutter

May 11 (Reuters) - A strain of avian flu that until now had been found only in the Western United States has cropped up in Indiana, bringing the total number of states affected by the virulent outbreak to 15, the U.S. Department of Agriculture said on Monday.

The eastward spread of any strain of the highly contagious H5 virus is worrying to farmers and investigators, who have hoped that warmer spring weather would help lower the number of infections in birds and curtail the virus' spread.

The H5N8 strain found in a backyard poultry flock in Indiana is concerning to them also. It is different from the H5N2 strain that has been confirmed in scores of Midwestern farms and resulted in the death or culling of nearly 30 million birds so far.

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The highly pathogenic H5N8 strain had been seen only in the Pacific flyway during this outbreak. Federal and state officials have confirmed it in commercial chicken and turkey farms in California and a backyard poultry flock in Oregon. It was also found in captive falcons in Idaho and Washington, according to the USDA.

How the H5N8 virus moved eastward is not yet known.

"We're working on the epidemiology, but the new finding of H5N8 is mostly likely due to a new introduction by waterfowl," USDA Animal and Plant Health Inspection Service spokeswoman Joelle Hayden said in a statement.

The H5 strains in the current U.S. outbreak pose a low risk to human health, experts say, and no human infections have been identified so far.

EGGS COMPANIES HIT

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The U.S. poultry and egg industry has been grappling for months with the biggest outbreak on record of avian influenza in the United States.

The economic ripple effects are starting to be felt, from baked goods companies feeling a squeeze on egg supplies to Hormel Foods Corp unit Jennie-O Turkey Store announcing a planned, temporary layoff of 233 workers at a Minnesota plant because the outbreak has reduced turkey supplies.

On Monday, shares of the largest U.S. egg supplier, Cal-Maine Foods Inc, touched a record high after theflyonthewall.com said research firm Sidoti & Co raised its price target on the stock, citing better egg pricing power following a shortage of egg-laying hens due to the outbreak.

Last week, Post Holdings Inc said that chickens at one of its third-party contractors, which accounts for about 10 percent of the company's egg supply, had tested positive for bird flu. The company, which said it is analyzing the financial impact of the news, did not respond to requests for comment.

OUTBREAK IN INDIANA

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USDA confirmed the Indiana test results on Sunday and the site in Whitley County has been quarantined.

Indiana State Board of Animal Health officials worked with the birds' owner to cull the 77-bird backyard flock before the final positive test came back from the federal laboratory, a spokeswoman told Reuters. The flock was a mix of ducks, chickens, geese and turkeys. The flock was culled on Saturday.

There have been three strains of H5 identified in North America in this outbreak.

The H5N2 strain has been reported in Arkansas, Idaho, Iowa, Kansas, Kentucky, Minnesota, Missouri, Montana, North Dakota, Oregon, South Dakota, Washington and Wisconsin. It has also been identified on farms in British Columbia and Ontario, Canada.

The Canadian authorities also have confirmed the H5N1 strain was found in British Columbia, Canada. (Reporting by P.J. Huffstutter in Chicago; Editing by Chizu Nomiyama and Matthew Lewis)

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