MARTIN, Michigan, July 10 (Reuters) - Some dairy farmers

are resisting Michigan's nation-leading efforts to stop the

spread of bird flu for fear their incomes will suffer from added

costs and hurt rural America.

The government's restrictions, which include tracking who

comes and goes from farms, are rekindling unwanted memories of

COVID-19 in Martin and other small towns in central Michigan.

The state has two of the four known cases in humans, all

dairy workers, since federal authorities confirmed the world's

first case in U.S. cattle in late March. The state has tested

more people than any of the 12 states with confirmed cases in

cows, according to a Reuters survey of state health departments.

Testing policies vary by state.

Public health experts fear the disease has the potential

to turn into another pandemic just a few years after COVID-19.

As those worries mount, the acceptance and success or failure of

Michigan's proactive response is being watched by other states

looking for a roadmap that goes beyond federal containment

recommendations.

More than a dozen interviews with Michigan producers,

state health officials, researchers and industry groups, along

with preliminary data, so far show limited dairy farmer

participation in efforts to stem and study the virus. In some

cases, calls from local health officials go unanswered, money

for dairy farm research is left unclaimed, and workers still

milk cows without extra protective gear.

Brian DeMann, a dairy farmer from Martin, Michigan, said the

outbreak and state's response recalls COVID-19. The 37-year-old

believes Michigan's rules to contain bird flu would be more

widely accepted if they came as recommendations rather than

requirements for farmers.

"Nobody knows if these things that we're being told to do

are going to stop it," said DeMann, who echoed an uncertain view

shared by other farmers. "Just like 2020, people didn't like to

be told what to do."

This spring many U.S. dairy owners did not heed federal

recommendations to offer more protective equipment to employees,

according to farmers and workers. DeMann said he did not invest

in new protective gear, such as masks, for his workers because

it is unclear how the virus is spreading.

NO EXTRA GEAR

About 900 permitted dairy farms dot Michigan's countryside,

with cows in open-air barns and piles of feed covered with

protective tarps and old tires used as weights.

Tim Boring, Michigan's agriculture director, said social

stigma and economic concerns around infections have discouraged

farmers from testing cows for bird flu in the nation's sixth

biggest milk producer.

"There's a lot of factors that go into the concerns about

farms coming forward with positive operations," he said. "We

know this has been a challenge in Michigan."

The state last reported an infected dairy herd on July 9,

its 26th to test positive. Five other states have also confirmed

cases in the past month, and about 140 herds have been infected

nationally since March, according to U.S. Department of

Agriculture data.

Michigan is offering farms up to $28,000 to entice those

with infected herds to participate in research. More than a

dozen farms have so far expressed interest, the state said.

Separately, the federal government is offering financial

assistance. Twelve of 21 herds enrolled in financial support

from USDA are from Michigan, according to the agency.

To boost testing, USDA launched a voluntary program in which

U.S. farmers can test tanks of milk weekly for bird flu. Six

farmers in six states have enrolled one herd each, but a

Michigan farmer is not among them yet.

"I really would like to see that in every single herd," said

Zelmar Rodriguez, a Michigan State University dairy veterinarian

studying infections.

'NEW THREAT'

Michigan's agriculture department said it has up to 200

people responding to bird flu cases in poultry and cattle,

including coordinating with USDA on outbreak investigations.

Veterinarians in other states said they tracked Michigan's cases

to assess the risks for transmission.

"Michigan is doing a good job with their diagnostics and

trying to identify where the disease is," said Mike Martin,

North Carolina's state veterinarian.

Michigan's outbreak in cows began after an infected Texas

farm shipped cattle to Michigan in March before the virus was

detected, according to USDA. Weeks later, a Michigan poultry

farm also reported symptoms and tested positive. Whole genome

sequencing suggested the virus spilled over from the dairy farm

to the poultry flock.

USDA now thinks the virus has spread indirectly through

people and vehicles moving on and off infected farms.

Chickens owned by Michigan's largest egg producer,

Herbruck's Poultry Ranch, were infected because the virus spread

from cattle, said Nancy Barr, executive director of Michigan

Allied Poultry Industries, an industry group. Reuters is first

to report the link to Herbruck's from dairy cow transmission.

"It's a new threat to us," Barr said.

Herbruck's told the state in May it was laying off about 400

workers after bird flu decimated flocks in Ionia County. The

company said in a public notice it planned to rehire employees

as it rebuilds its flocks, a process that can take six months.

As of late June, Ionia County poultry farmers received $73.2

million in indemnity payments from the U.S. government for

bird-flu losses, the most of any county in the country that had

to cull infected flocks since February 2022, according to data

Reuters obtained from the USDA.

MAIN STREET

The layoffs struck fear in Ionia, a city of about 13,000

people in central Michigan with a brick-paved Main Street and

mural of the Mona Lisa. Business owners said unemployed workers

have less money to spend at time when local stores already

struggle to compete with Walmart and Meijer.

"I just thought, 'Oh great, here goes the store,'" said

Jennifer Loudenbeck, owner of the Downtown Vintage Resale shop.

Alex Hanulcik, who owns a fresh fruit stand, said he knows a

Herbruck's employee who left town to find work in the southern

U.S. after being terminated.

"I really feel for the employees," Hanulcik said. "They were

blindsided."

Herbruck's declined to comment.

Dairy farmers said they are constantly worrying their cows

may be the next to become infected, yet they are unsure exactly

how to protect them.

Doug Chapin, a dairy farmer in Remus, Michigan, said he held

meetings with employees to inform them of the risks of the

virus. He is trying to make workers wear protective eye gear,

though they objected in the past because glasses must be cleaned

if milk sprays on them.

"You're thinking about it all the time," he said about the

virus.

Michigan has plans to test dairy workers for signs of prior

infections with first-in-the-nation blood testing.

The state has already monitored thousands of people for bird

flu symptoms using a complex contact tracing system that texts

them three times daily, said Chad Shaw, health officer for the

Ionia County Health Department.

Some farmers remain reluctant to engage with local health

authorities, though.

The Branch-Hillsdale-St. Joseph Community Health Agency

began reaching out to farms generally to offer medical care for

seasonal workers because of bird flu cases, said health officer

Rebecca Burns. There has been little interest, she said.

"These guys aren't used to us calling them," Burns said.

HARD HIT

Michigan has detected the third most infected dairy

herds of any state, after Idaho and Colorado, and lost 6.5

million chickens in April alone from outbreaks on poultry farms,

USDA data show.

The Biden administration in late April began requiring

lactating cows to test negative before being shipped over state

lines.

Michigan went further and in May started requiring farms to

keep logs of visitors, disinfect delivery trucks that could

carry the virus, and take other safety steps. The state this

month began requiring negative tests for non-lactating cows to

be shown at fairs.

Colorado reported the nation's fourth human case on July

3. The U.S. government awarded $176 million to Moderna ( MRNA )

to advance development of its bird flu vaccine for humans.

Two dozen companies are working on a vaccine for cattle,

U.S Agriculture Secretary Tom Vilsack said, as about 140 herds

nationally have tested positive.

"Michigan's been the forefront on providing information,

providing access to information that really is helpful," Vilsack

told Reuters.