Australia's largest poultry producer has plunged its farms into lockdown after a deadly avian flu strain was discovered in the country.

The H5N1 variant of the virus was confirmed in a sick brown skua found on a remote beach near Esperance in Western Australia, about 700km south-east of Perth.

A second migratory bird, a giant petrel, has returned a positive result, while more than a dozen cases of sick or dead birds have also been reported.

Inghams Group announced on Monday that despite no detections in commercial poultry, it had made a decision to mitigate against any potential risks across all their WA sites. 

'This includes the implementation of a complete lock-down, preventing all non-essential access, across all the company's WA farms and processing operations,' the statement said. 

The company is also seeking a regional housing order, allowing WA free range poultry to be kept indoors, from the state government. 

Chief veterinary officer Beth Cookson says Australia has been preparing for the deadly avian flu for years as the only continent previously unaffected by the strain. 

'Our actions at the moment are really to understand whether these two single individual birds have been able to spread it into other populations in Australia,' Dr Cookson told ABC Radio National on Monday. 

'Our approach is to really learn from the overseas experience and look at the practical actions that can be put in place to mitigate the impacts as far as possible.'

At this stage, she said, there were no other detections in wildlife, poultry or agricultural systems.

She said the two sick birds had a breeding habitat on the sub-Antarctic territories Heard Island and McDonald Islands, where the strain has killed 13,359 southern elephant seal pups.

Members of the public are urged to report any sick or injured bird they come across, but to keep their distance as the virus, on rare occasions, can spread to humans in close proximity. 

There have been 16 reports of sick or dead birds in WA since the first detection, but Environment Minister Murray Watt said it wasn't yet clear whether they related to bird flu or the 'many other reasons birds die every single day'. 

'At this point, there's no need for alarm that this has become a more widespread incident beyond those two birds,' Mr Watt said on Monday. 

'We know that bird flu can not only impact on birds but also mammals as well ...  the ones that we're most concerned about are our most endangered species, whether it be particular types of birds, [and] the Australian sea lion.' 

The federal government has developed more than 100 response plans for key sites and vulnerable species and invested about $100 million in preparedness. 

The discovery has fuelled fears among scientists, conservationists and agricultural groups, who point to mass mortality events and species-level population reductions in overseas outbreaks.

University of Melbourne researcher Michelle Wille said Australian authorities had been preparing for a worst-case scenario, but international examples painted a gloomy picture. 

'Everywhere this virus has emerged has been really catastrophic, with mass mortality events in wildlife, and in some places, we've seen species-level reductions in population,' she said.

Industry impacts could also be significant, she said, noting more than 200 million chickens had been culled in the US since the virus arrived there.