Hours after Canadian agriculture officials announced that they had identified bovine spongiform encephalopathy in an Alberta cow, the U.S. government, stock market and companies involved in selling beef responded.
This is the first case of BSE in North America since 1993. "Identifying this animal, and keeping it from entering the food pipeline shows that the systems in place for this very purpose are working," said a Canadian agricultural official on CNN news. Officials are still working to trace the animal back to the farm of origin.
The U.S. government immediately shut down the northern U.S. border to all Canadian cattle. USDA has sent a variety of officials and veterinarians to Canada to assist in the investigation.
The stock market reacted negatively to the news, sending many restaurant stocks lower. McDonald's took a particularly hard hit for no apparent reason other than it's the world's largest burger chain. Click here for other responses.
The timing of this BSE discovery is bad for beef sales, as the Memorial weekend and prime grilling season is just getting underway. Still, many analysts believe that any fallout for U.S. beef will be minimal and temporary.
Others, however, expect that at least for a time, consumers will turn to poultry and pork instead of beef. It all hinges on consumer confidence in beef supplies in the U.S. meat case.
"If beef consumption drops as a result of consumer fears, it could affect U.S. cattle prices, and cattle represent 20 percent of all farm receipts," says Chris Hurt, Purdue University ag economist.
Canada is the United States' largest live-cattle supplier, providing 5 percent of total annual production. It's the United States' second largest beef supplier at 9 percent of the annual total, 4 percent of that arrives as processed product. If consumers hold their beef consumption steady, it could increase U.S. live-cattle prices by as much as 10 percent, says Hurt.
Japan and Korea have joined the United States in banning imports of Canadian live cattle and/or beef. This also could benefit U.S. beef producers as the United States could see a boost in export opportunities.
Other meat products also could rise in value.
Hurt says 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.
The U.S. Food and Drug Administration banned feeding ruminant-derived protein to cattle and sheep in 1997. Historically, BSE has been transmitted by feed
contaminated with protein from infected animals. The United States has many other control measures in place such as cattle that die with BSE-like symptoms are examined thoroughly by inspectors and at diagnostic laboratories.
"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.
On a divergent but related note, Canada's BSE incident will likely fuel the fire in support of the country-of-origin labeling law. Expect more "consumer" groups, activists and even agricultural supporters of the law to point to this as even stronger evidence as why labeling is necessary.