April 9, 2004

US Meat Group: USDA Underestimated Cost Of New BSE Rules

The U.S. Department of Agriculture significantly underestimated how much it will cost industry to comply with new bovine spongiform encephalopathy, or mad-cow disease, regulations, the American Meat Institute said Thursday.
 
The economic impact of those rules, according to AMI, will be $381 million to $638 million annually, as much as four times the USDA estimate. The USDA this week said the range will be $110 million to $149 million.
 
In response to the December discovery of a BSE-infected cow in Washington state, the USDA announced new regulations that ban meat from non-ambulatory, or "downer" animals, from the human food supply, expand the types of bovine tissue considered to be a risk of carrying BSE in cattle that are over 30 months of age and further restrict advanced meat recovery technology to scrape meat from carcass bones.
 
AMI Foundation President James Hodges said the group, which represents U.S. meatpackers, believes the USDA failed to take into consideration the high costs of accurately designating and then separating out cattle that are over 30 months old in order to remove specified risk material.
 
"They assumed there wasn't any cost to segregation," Hodges said. "They assumed that it was only paperwork and that's simply not the case."
 
AMI estimated segregation costs, including implementing methods to determine an animals age by its teeth and segregating cattle floors, at $200 million to $268 million.