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From: TSS ()
Subject: Mad-Cow Test On U.S. Animal Sparks Concerns $$$
Date: June 13, 2005 at 8:57 am PST


Mad-Cow Test On U.S. Animal Sparks Concerns

By SCOTT KILMAN
Staff Reporter of THE WALL STREET JOURNAL
June 13, 2005; Page A8

The second American cow to test positive for mad-cow disease is sparking new questions about the safety of U.S. beef and how the Agriculture Department looks for cases.

While the discovery probably won't spook most consumers -- partly because of government assurances that the prevalence of mad-cow disease in the U.S. is very low -- cattle prices are widely expected to sink today on speculation that the development will further discourage Japan and other countries from reopening their borders to American beef.

Agriculture Secretary Mike Johanns said Friday that a brain sample from a crippled beef cow the department had declared free of the fatal brain-wasting disease in November had just generated a "weak positive" in a more-sensitive test.

Mr. Johanns said none of the cow's meat entered the food supply, thanks largely to new rules created after the first U.S. mad-cow case was discovered in December 2003 in an imported Canadian dairy cow living on a Washington state farm. The latest cow was old when it was slaughtered and couldn't walk, automatically disqualifying it from human consumption. After a brain sample was collected, the carcass was burned.

Because the tests conducted on the November 2004 cow conflict, the Bush administration hasn't declared whether the animal was infected, and probably won't for at least a week. The USDA is conducting more tests at its laboratories in Ames, Iowa, and will send brain tissue to the world's premier mad-cow testing laboratory in Weybridge, England.

If the latest discovery withstands further scrutiny, it could establish for the first time that the disease is in the native-born U.S. cattle population. After the first infected cow was discovered 17 months ago, the Bush administration limited damage to the $45 billion ranching sector by proving that the animal had lived its first 4˝ years in Canada, and most likely caught the slowly-incubating disease there.

While the USDA has disclosed few details about the suspect beef cow, federal authorities said they have no evidence yet that the animal was imported. According to people familiar with the matter, the cow was several years old and found in Texas.

Regulators are now trying to find other cattle that grew up with the cow and shared its rations, but that task could be complicated by the seven-month delay since the cow first came to the government's attention in November. Cattle typically catch the fatal brain-wasting disease by eating feed contaminated with the remains of infected cattle.

Mad-cow disease, which is technically known as bovine spongiform encephalopathy, can cause a rare but fatal brain disorder in people who eat products from infected cattle. The disease has erupted in the indigenous cattle populations of more than 20 nations, including Canada and Japan.

The testing flip-flop is an embarrassment for USDA officials, who have resisted calls by consumer groups to employ the more-sensitive test -- called the "Western blot" -- as European and Japanese regulators do when cattle-brain samples trigger conflicting results on less-sensitive tests. The Western blot was used in this recent case only at the prodding of investigators in the USDA inspector general's office. The inspector general has been skeptical about the ability of the government's expanded mad-cow surveillance program to determine the prevalence of the disease in U.S. cattle.

"We think the USDA is not doing enough," said Michael Hansen, a senior research associate at advocacy group Consumers Union, who said he pressed last week during a meeting of the National Academies' Institute of Medicine for the USDA to screen a sample of the November cow with the Western blot. Bill Bullard, chief executive of R-Calf USA, a ranchers group, called for congressional hearings into the USDA's mad-cow surveillance program.

John Clifford, the USDA's chief veterinary officer, said the department is evaluating whether to use the Western blot test more frequently. "This is a very unusual case," Dr. Clifford said. "We are still very confident in our program."

Write to Scott Kilman at scott.kilman@wsj.com

wsj.com/

Traders eye funds on BSE test

DJ CME Cattle Traders Watch Funds In Wake Of BSE Test

8:20 AM, June 13, 2005

By Jim Cote

Of DOW JONES NEWSWIRES

CHICAGO (Dow Jones)--Many Chicago Mercantile Exchange livestock futures

traders arrived early Monday morning to compare ideas following Friday night's

U.S. Department of Agriculture announcement that a U.S. meat sample once tested

and believed negative for bovine spongiform encephalopathy, known commonly as

mad-cow disease, has been re-tested and showed positive this time.

USDA Secretary Mike Johanns said the sample was being sent to a laboratory in

England to confirm the new result.

Most traders expect lower opening cattle futures prices, with about 100

points lower the average early estimate.

"The big wild card in this whole thing is that we are near a technically

sensitive chart area. I don't think this would be as big a thing otherwise,"

said one veteran trader whose thoughts were echoed by many others. "At some

point, the huge long position held by funds will liquidate. I don't know where

that is, but no one wants to be holding long positions when or if it happens."

The Commodity Futures Trading Commission reported that the large speculative

category in the commitments of traders report held 35,240 long live cattle

futures contracts as of last Tuesday's close. Traders consider many of those

positions to be owned by funds or fund-like accounts.

Of course, traders holding short positions think cattle futures prices will

plunge. "Who wants to buy? Who wants to stick their hand in the fire until the

test results come in?" asked one proponent of lower prices. "In any case, this

will not be good for the resumption of U.S. beef imports to Japan."

However, a senior Japanese agricultural ministry official said Monday Japan

will continue procedures to remove its import ban on U.S. beef despite the

possiblity of a positive BSE test result, Kyodo News reported.

-By Jim Cote, Dow Jones Newswires

agriculture.com

TSS




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