An animal suspected of having mad cow disease was born before the implementation of the 1997 feed ban that prohibits cattle remains in animal feed, the U.S. Agriculture Department said on Monday.
“It is significant to note that this animal was born prior to the implementation of the 1997 feed ban — another example our safeguards are working,” the USDA said.
In 1997, the United States outlawed the use of cattle remains as a protein supplement for cattle, goats and sheep to prevent the spread of mad cow disease. The regulation is considered by experts as the most important safeguard against the brain-wasting disease.
Cattle prices fell Monday but shares of the largest U.S. meat company inched higher as the nation awaited a new round of tests that could determine if the United States has its second case of mad cow disease.
A second case could further delay the restarting of beef exports to Asian markets, which have been closed to U.S. beef since December 2003, when the United States reported its first and only case of the disease.
U.S. consumers are expected to continue eating steaks, roasts, and hamburgers even if a second case is confirmed, because two cases out of the millions of cattle processed each year should not be seen as a threat, analysts said.
“To me that doesn’t seem like we have a systemic problem,” said Todd Duvick, Banc of America food industry analyst.
Shares of Tyson Foods Inc., the largest U.S. meat company and the top beef producer, closed higher.
Duvick said Tyson’s ability to rely on its pork and poultry operations, should beef sales be hurt by a new case of mad cow disease, also may be helping the stock.
The other top beef companies, Swift and Co., National Beef Packing Co. and Cargill Inc., are privately held.
The latest suspected case was cleared of the disease in November 2004, but a new round of tests suggested it may have been infected. To be certain, brain samples were sent to England where final tests may ready in two weeks.
Immediately after the first U.S. case two years ago, beef sales dropped, beef exports came to halt and cattle prices tumbled. While many export markets are still closed, domestic beef sales have recovered and cattle prices have rebounded.
The concern for consumers is that scientists believe humans can contract a similar fatal brain disease by eating infected beef from animals with the disease. USDA has assured consumers that no meat from the latest case entered the food chain.
“If the past two years since the first animal in Canada tested positive is any guide, there is no reason to expect any change in consumer behavior,” David Nelson, analyst with CreditSuisse First Boston, wrote in a research report.
Canada reported its first case of mad cow disease in May 2003 and seven months later the U.S. reported its case. The U.S. case was a Canadian-born cow found in Washington state.
The U.S. Agriculture Department has not disclosed the location of the suspected case and analysts said the severity of any future reaction will likely depend on the location.
If it is in the northern United States and can be traced to Canada, the reaction might be mild. If it is from the heart of cattle country in the Plains and indigenous to the United States, the reaction would be more severe.
“I would guess that if they say it is from Texas, the futures would again be under pressure similar to the way they were this morning,” said Jim Robb, agricultural economist at the Livestock Marketing Information Center.
Cattle futures at the Chicago Mercantile Exchange were sharply lower Monday. In the days after the December 2003 case, the futures dropped the daily trading limit for several days.
“Realistically it doesn’t change much about the outlook,” said Dan Vaught, A.G. Edwards livestock analyst. “The U.S. has never really regained many (export) markets since the announcement of the first mad cow disease. Really the only two major markets we’ve regained have been Mexico and Canada.”