The government is confident its teams will be able eradicate the high pathogenic avian influenza or bird flu, which has been found at an Otago farm.

The Ministry for Primary Industries said laying hens foraging outside were thought to have been infected with the H7N6 strain through a low pathogenic virus from wild waterfowl.

There are 40,000 chickens in the shed where the virus was identified, and teams would begin eradicating birds on Tuesday.

Biosecurity New Zealand deputy director-general Stuart Anderson said there had been no signs of further infection so far.

"While it is not the H5N1 type circulating among wildlife around the world that has caused concern we are taking the find seriously," he said.

"Low pathogenic viruses are present in wild birds here, especially waterfowl like ducks, geese, and swans and the virus can mutate on interaction with chickens.

Chickens in other sheds at the infected farm were not showing any signs of influenza.

A 10km buffer zone had been placed around the farm, along with restrictions to prevent the movement of animals, equipment, and feed.

"It is important to note that the strain found on this farm is not a wildlife adapted strain like H5N1, so we believe it is unlikely to be transmitted to mammals."

MPI was not concerned about the risk to human health or food safety, and it was still safe to consume thoroughly cooked egg and poultry products.

Anderson said quick action had been taken in co-operation with Mainland Poultry and a restricted place notice issued.

"Test results late last night [Sunday] confirmed the strain, but we already had restrictions in place and expert biosecurity staff on site, with more arriving today [Monday]. Mainland Poultry took the right steps by reporting ill birds in one shed on the property and locking that building down as testing continued.

"We will move quickly, with Mainland Poultry, to depopulate birds on the remote property and we've placed a 10-kilometre buffer zone around it alongside the restrictions preventing movement of animals, equipment, and feed.

"We aim to stamp this out like we did with infectious bursal viral disease that affected chickens in 2019."

John McKay, chief executive of Mainland Poultry, which manages the free-range farm said it was committed to taking quick action.

"We have been preparing for an event like this for some time knowing that low pathogenic avian influenza is already present in New Zealand wild birds. Fortunately, this is not the H5N1 type that has caused concern for wildlife in other parts of the world," McKay said.

"International experience with avian influenza has shown us this particular strain (H7N6) can be eradicated quickly and successfully.

"We will be working closely with MPI to depopulate the affected shed, ensure rigorous testing of all other birds on the farm and manage the situation effectively. I'm confident with swift action and collaboration we can eradicate this."

Anderson said Biosecurity New Zealand was working closely with industry partners to ensure the find was dealt with quickly and any possible impacts to trade limited.

"Importantly, the farm has strong biosecurity standards and Mainland is helping with ongoing investigation and tracing of animal movements," Anderson said.

"We have put a lot of effort in with the poultry and egg sector, the Department of Conservation, and Ministry of Health to prepare for H5N1 and that puts us in a good position to deal with the less virulent H7N6 strain found on this farm.

"If anyone sees three or more sick or dead wild birds in a group, report it immediately to the exotic pest and disease hotline on 0800 80 99 66 so we can investigate the cause."

Michael Brooks - the executive director of both the Poultry Industry Association and Egg Producers Federation - told RNZ it was lucky the flu had been spotted early.

"At the moment we believe it is only shed on one farm, there is certainly a lot of checking going on - can it have been transported elsewhere.

"But at the moment it doesn't seem to have spread to anywhere else, which is really pleasing."

Brooks said consumers could feel reassured.

"There is no food safety risk here. You just cook the product, be it eggs or meat, and it is perfectly safe product to eat."

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