Senators Seek Envoy to Fight U.S. Beef Bans

The United States should authorize a special envoy to negotiate the end to international bans on American beef imposed after the discovery last month of a Holstein infected with mad cow disease, Senate Democrats urged Tuesday.

“This trade envoy must reopen foreign markets to U.S. beef,” said Sen. Max Baucus (D-Mont.) “This is a consumer confidence matter.”

Several members of the Committee on Agriculture, Nutrition and Forestry also called for stronger food safety regulations and for an inquiry into possible insider trading on cattle futures markets before the U.S. Department of Agriculture’s announcement Dec. 23 that a cow in Washington state had tested positive for bovine spongiform encephalopathy.

The Commodity Futures Trading Commission said Tuesday that an investigation was underway. First reported in Tuesday’s Wall Street Journal, the inquiry is focusing on traders who, before the USDA announcement, bet that cattle prices would decline.

The senators expressed concern over the economic effects of the restrictions on U.S. beef exports. More than three dozen countries -- including Japan, South Korea and Mexico, the largest markets for U.S. beef -- have instituted bans.

“In a little more than a month, we have already seen the economic impact of losing beef export markets,” said Sen. Tom Harkin of Iowa, the committee’s ranking Democrat. “About $200 million worth of product shipped overseas prior to December is now in limbo, with no countries in the region willing to accept it.”

Agriculture Secretary Ann M. Veneman told the committee Tuesday that delegations from Japan and Mexico were visiting the United States to review the mad cow investigation. She recently met with agriculture ministers from Canada and Mexico.

A rebound for the beef industry will be gradual, said Chandler Keys, vice president of government affairs for the National Cattlemen’s Beef Assn., a trade group. Steep losses followed the initial announcement, he said, and they will continue until foreign markets return.

Still, optimism prevailed among committee members and witnesses. Veneman said that cattle prices on cash and futures markets had initially dropped 15% to 20% because of mad cow fears, but current prices were above their levels of a year ago -- although down 5% to 8% from their recent highs.

“The marketplace has stabilized and there has been no public panic,” said Sen. Thad Cochran (R-Miss.), chairman of the committee. “Most Americans realize that we have in place inspection and safety procedures that are effective in protecting our food supply.”

In a related development, Sen. Richard Durbin (D-Ill.) introduced legislation mandating more aggressive and rapid testing of livestock for mad cow disease, a broadened definition of “contamination” and heightened standards for livestock feed.

The legislation would put into law the most recent policies imposed by the USDA and the Food and Drug Administration. It now takes five to seven days for completion of testing for mad cow disease. Under the proposal, meant to identify tainted meat before it can be distributed, testing would be completed within 12 hours. Last week, Veneman told a house committee that her department was in the process of approving such rapid tests.

At Tuesday’s hearing, Durbin said the United States would benefit from the creation of a single food safety system, although his bill does not recommend one. Currently, food safety is divided among several departments, including the USDA, the FDA and the Department of the Interior.

“Our government is doing just enough to put the mad cow issue behind us, but not enough to give our nation’s consumers the confidence and protection they deserve,” he said. “That must change.”