050634 Mad Cow: Consumers NOT Shying Away From Beef

Austin, TX - Roxanne Balusek didn't have a second thought about the meats on her shopping list.

Despite the recent announcement that federal officials traced the first U.S.-born animal with mad cow disease to a Texas plant, the Austin-area resident said Thursday she wasn't changing her dinner plans.

"I just feel like they have it under control, otherwise they wouldn't have beef in the stores," Balusek said.

Officials on Thursday did not say where in Texas the cow originated, or how it got the disease. But the news has received a muted response among consumers and cattlemen alike, who said they are taking a wait-and-see attitude rather than declaring a market emergency.

"Certainly we're concerned," said Phil Sadler, a cattleman in Golden and a member of the board of directors of the Independent Cattlemen's Association of Texas. "But beef is really very, very safe."

As they did Wednesday, officials continued to stress that the animal did not enter the food supply, and the carcass was incinerated.

"Consumer confidence is still there," said Beverly Boyd, a spokeswoman for the Texas Department of Agriculture.

Champion Pet Foods, Inc. of Waco received the 12-year-old cow in November. The cow arrived dead, and the company followed its standard practice of sending a sample from the cow to Texas A&M University for testing, a Champion official said.

Authorities tested the animal for mad cow disease several times, with inconclusive results. This month, two additional tests found the cow to be positive for the disease, said Jim Rogers, a spokesman for the U.S. Department of Agriculture, which is investigating. Rogers said officials don't know how the cow died.

In a written statement released late Wednesday, Champion owner Benjy Bauer said the cow was never made into pet food.

"We are confident to report that the system works for pets as well as humans," Bauer said in the statement.

The Agriculture Department traced the diseased cow back to a herd in Texas. The department has put that herd on hold, meaning no animals can enter or leave the group while the investigation continues. Rogers said he doesn't expect to find another infected animal in that herd.

Rogers would not identify the owner or the location of the herd, and he said authorities don't know how the cow got the disease.

Mad cow disease, or bovine spongiform encephalopathy, is a disease that attacks the central nervous system in cattle. Scientists suspect a link between BSE and Creutzfeldt-Jakob Disease, a similar, fatal brain illness that affects humans.

The diagnosis marks the first case of the disease that appears to have originated in the United States. In December 2003, mad cow disease was found in a Canadian dairy cow in Washington state.

In January 2001, a herd in a South Texas was quarantined after possibly eating meal that included ground-up animal parts, a practice that was banned by the Food and Drug Administration in 1997 as a possible way of transmitting mad cow disease.

Gary Barclay, a cattle rancher who also works as a meat-cutter at the flagship Whole Foods store in downtown Austin, said that some customers have begun asking him about mad cow disease.

"It's not a panic, but people do ask about it," Barclay said, adding that one customer on Thursday bought pork along with beef tenderloin because of the BSE news.

"This guy had already made up his mind that he was going to get half pork, half beef, because it was on the news and some people were not going to eat beef at his party," he said.

Matt Brockman, executive vice president of the Fort Worth-based Texas and Southwestern Cattle Raisers Association, said he's not losing sleep over the news.

"We expect consumer confidence is still strong," Brockman said. "It's something (people) see on the news, but I think they also sleep at night and are showing a good willingness to buy the product and throw it on the grill this weekend."

Source: Austin American-Statesman

Canadian Ranchers Rebuild Beef Market June 30, 2005

Lake Manitoba, Manitoba - A group of Manitoba ranchers hope the loss of U.S. cattle markets will have an unintended consequence, a stronger Canadian livestock market. Ranchers north of the border are still struggling with low prices. But some say closing the U.S. market to Canadian beef, is an opportunity to expand Canada's meat processing industry.

Mark Emilson has a small cattle ranch in north central Manitoba. He drives through the pasture, dropping salt blocks for his herd.

For the past 20 years Emilson has raised calves, and each year he sells the animals to feedlots. The feedlots fatten the animals for slaughter. He says it's a good life. Emilson and his wife live on the ranch started by his father in 1959. But for the past two years, things have been rough.

"When the BSE hit and the price of cattle went way down, it caused a lot of anguish to a lot of people, and we really had to trim down loans," says Emilson. "We had to extend payments. It's really eroded the equity of a lot of the places that are around here."

Two years ago, Emilson was getting $700 for each calf. Today, his price is $100. Like ranchers in the United States, Emilson's expenses are on the rise. Fuel, feed and taxes have all increased in the past two years.

With the U.S. border closed to Canadian cattle, ranchers have lost a valuable market. They can no longer sell live cattle to feedlot owners in the United States or to U.S. packing plants. There are no packing plants in Manitoba, so ranchers who raise cattle for slaughter must ship their herds hundreds of miles.

Shipping fees cut into shrinking profit margins, and smaller margins mean less money to buy calves from ranchers like Daniel Warrener.

"I don't think cows are going to go across to the states for many years. We need a place to slaughter them, especially in Manitoba," says Warrener. "There's some (meatpacking plants) in Montreal and there's some in Alberta, so either our cows go east or they go west."

Warrener says ranchers need to find a market to replace U.S. feedlots and meatpacking plants. Preferably one close to home, to cut down on shipping costs.

Raising cattle has always been a risky business. With the U.S. border closed, Canadians are struggling to find buyers for their herds. Warrener says when the U.S. announced it would reopen the border in March, prices started to climb.

When a cattlemen's group in the U.S. got a court injunction to keep the U.S. market closed, prices dropped. Warrener says it's a situation that makes it hard to plan for the future.

"When you talk to the banks you can't tell them what you plan, because you don't know what's going to happen from day one to day two," says Warrener. "You can't say, I want to keep 100 yearlings, and you end up keeping 200 because you can't sell them for the price you want."

Canadian ranchers are frustrated. They don't understand why the U.S. ban is still in place. Some fear the discovery of a new case of BSE will keep the border closed to Canadian livestock permanently.

Warrener and his neighbors insist safeguards are in place to protect consumers from BSE or mad cow disease. Rock-bottom beef prices have some ranchers taking drastic actions.

Rancher Garth Lussier tells a story about a neighbor who wanted to sell a bull. On the way to the sale he got a flat tire. The repair bill cost him more than he'd get for the bull. So Lussier says, the neighbor went back home and shot the animal.

"The auction mart isn't next door. You have to load that animal up, take it 50 miles and come back home again. So there's an expense, a tank of fuel for sure," says Lussier. "That's a hundred bucks. And if you have tire trouble on the road that's another maybe $100 or $150 expense, so that bull is only going to get you $50. What's cheaper? The bullet or the expense?"

Lussier says other ranchers have done the same thing. But where some ranchers see nothing but frustration, others like Blair Olafson see opportunity.

"I might sound like a renegade here, but I think it's a good thing," says Olafson. "The reason for that is we will build and establish our own slaughter industry."

Blair Olafson is a busy man. He runs a resort, he's an outfitter and a commercial fisherman. He's also a rancher with 1,000 head of cattle. His latest business venture is building Manitoba's first modern meatpacking plant.

Olafson has organized a cooperative of businessmen and ranchers. Together, through loans and private investment, they've raised $14 million to build a packinghouse.

The idea is not new. Ranchers in the United States have toyed with the idea of processing their own herds, but it's an expensive proposition. To keep a plant running you need lots of cash to buy cattle. Independent plants must compete with established corporations which have deep pockets for those animals.

When ranchers try to build their own packing plants, their efforts rarely get beyond the planning stage. It's simply too expensive. But Olafson believes this venture will work, since it will focus on a part of the market big corporations have little interest in.

"Because we're not competing against -- we'll call them the big boys -- the Cargills and the IBPs," says Olafson. "They're a fat cattle market and we're just going to kill the culls -- the hamburger and baloney cows."

Cull cattle don't bring the highest prices, Olafson explains, but there's a steady demand for them since there's always a market for hamburger.

Corporate meatpackers are more interested in the other end of the industry - - the fat or slaughter cows. Those animals sell for higher prices and end up as steaks and roasts.

The problem is, with no U.S. market available, there are too many hamburger cows in Canada. Olafson estimates the herd at 1.5 million nationwide. With a new plant, Olafson and his partners say they'll create competition and boost the prices paid to ranchers. He's convinced there are enough cull animals in Manitoba to make the plant successful.

"There's probably 200,000 cattle. And that's not even talking about the cattle in northwestern Ontario or the cattle in Saskatchewan," Olafson says.

Two years ago when the U.S. border closed to Canadian beef, Olafson and his partners started raising money for their meatpacking plant. He expects construction to take place this summer, and meat processing to begin this fall.

Ranchers think if the business is successful, it will motivate other investors to build plants in Manitoba and create a stronger, more competitive cattle industry -- one that won't be so reliant on U.S. markets.

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