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May 20, 2003

Canadian mad cow case could benefit U.S. beef

WEST LAFAYETTE, Ind. – The announcement of a case of mad cow disease in Canada could have a huge impact on the U.S. beef market, said Purdue University agricultural economist Chris Hurt. And whether that impact will be positive or negative may well rest mainly with consumers, he said.

"If beef consumption goes down as a result of consumer fears, that could affect cattle prices, and cattle represent 20 percent of all farm receipts," Hurt said. "Beef cattle are by far the largest single agricultural commodity in the U.S."

On the other hand, this could be a boon for U.S. beef.

"The consumers are going to have the biggest impact," Hurt said. "If they maintain faith in U.S. beef, this could turn out to be a good thing for our cattle producers."

Canada is the United States' largest live cattle supplier and its second largest processed beef supplier. "The United States has banned imports of Canadian live cattle and beef, and other countries are likely to follow," Hurt said.

"Nine percent of the U.S. beef supply comes from Canada. Four percent of that arrives as processed products and 5 percent as live cattle. The ban represents a 9 percent reduction in beef supply. If consumers maintain their consumption, that could sharply increase live cattle prices by as much as 10 to 12 percent."

This also could benefit U.S. beef producers if Canadian exports to the rest of the world are shut off. Hurt said that beef from the United States could experience a boost in value as foreign consumers shift to U.S.-origin beef.

Other meat products also could rise in value.

Hurt said pork and poultry will likely be at the top of consumers' minds when they're purchasing meat. In addition, soybean meal could see a bump in prices as feed suppliers search for alternative protein sources for animal feeds.

Mad cow disease, technically known as bovine spongiform encephalopathy (BSE), attacks the nervous system of cattle fed protein that came from other ruminants, which are animals that chew their cud and have a multichambered stomach.

Leon Thacker, Purdue veterinary pathologist and head of the Indiana Animal Disease Diagnostic Laboratory (ADDL), said the Food and Drug Administration banned feeding ruminant-derived protein to cattle and sheep in 1997.

"The 1997 ban prevents any feed products of ruminant origin from being fed back to other ruminant animals that will be used for slaughter," Thacker said. "Historically, BSE has been transmitted by feed contaminated with protein from infected animals."

There are already control measures in place in the United States. Thacker said cattle that die with symptoms of the disease are examined at diagnostic labs throughout the nation. In Indiana, they are checked at the ADDL.

"We are constantly looking for the occurrence of this disease," Thacker said. "We target and examine animals that are down or have died with symptoms that resemble BSE."

In general, the experts aren't concerned about the spread of mad cow disease to humans. They're more concerned about the impact the case will have on consumer confidence.

"The risk to individuals from beef consumption, even in Canada, is very low based on what we know from the British experience," said Simon Kenyon, Purdue Extension veterinarian.

Writer: Kay Hostetler, (765) 494-6682, kjh@purdue.edu

Sources: Chris Hurt, 494-4273, hurtc@purdue.edu

Leon Thacker, (765) 494-7460, thacker1@purdue.edu

Simon Kenyon, (765) 494-0333, skenyon@purdue.edu

Ag Communications: (765) 494-2722; Beth Forbes, bforbes@aes.purdue.edu; http://www.agriculture.purdue.edu/AgComm/public/agnews/

Related Web site:
Purdue University animal disease Web site


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