(Adds confirmation of H5N1, details)

By Miyoung Kim

SEOUL, April 16 (Reuters) - South Korea upgraded its bird flu alert to the second highest on Wednesday and sent in soldiers to help cull and bury birds amid the worst poultry influenza outbreak in four years.

In less than two weeks, South Korea has confirmed 11 cases of the deadly H5N1 strain, which had been contained in the southwest of the country, some 320 km (200 miles) south of Seoul.

And the Farm Ministry said on Wednesday an outbreak at a chicken farm in Pyeongtaek, just 60 km south of Seoul, had also been confirmed as H5N1, bringing the scare closer to the capital.

It also confirmed another case of the positive H5 strain in a farm in Sunchang county in North Jeolla province, raising fears that the virus is spreading fast and the country may see a repeat of late 2003 when it had to kill 5.3 million birds.

"We have culled around 2.3 million birds so far and the number will easily outgrow the 2006 level when we slaughtered 2.8 million," Kim Chang-seop, a ministry official in charge of livestock quarantine, told reporters.

Korea is investigating possible causes of the spread such as migrating birds and transport workers who have been moving around the affected sites and other parts of the country.

The Farm Ministry also said it would beef up quarantine work and extend its regular tests on poultry -- normally carried out during the most susceptible November and February period -- to all year round.

It also raised the risk level for bird flu, extending coverage nationwide from the southwest, while some 200 soldiers were deployed to help slaughter and bury poultry, the government said.

The latest outbreak appears to have had a limited impact on poultry consumption so far, as the country had a number of similar outbreaks in the past with no reports of human deaths.

South Korea had seven outbreaks of H5N1 between November 2006 and March 2007.

"We are having a bird flu case almost every year and it's become a sort of seasonal event and as a result people are now more used to it," said Choi Ja-hyun, an analyst at Hyundai Securities.

"Demand for poultry products will be affected but it is unlikely to have any huge impact on the industry," she said.

Chicken sales at four major retailers surveyed by the ministry showed a 58 percent decline in the first two weeks of april, but egg sales rose 14 percent.

The outbreak, however, has caused a fall in poultry prices of up to 11 percent this month, posing a bigger threat to farmers already struggling with high animal feed costs.

There are many types of avian flu viruses and experts are more worried about the H5 and H7 subtypes, which they think have a higher potential to mutate into forms that could pass easily between people and cause a human pandemic.

There had been 240 human deaths globally from the H5N1 strain and 380 confirmed cases of infection since 2003, according to World Health Organisation data.

($1=979.3 won) (Editing by Nick Macfie)

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