Mad cow makes U.S. the black sheep: American beef exports get stopped at border as world reacts to one diseased cow.

Where's the beef? That's a question that many around the world, Mexicans among them, will likely soon start asking themselves after a lonely Washington state Holstein dairy cow was diagnosed with deadly mad cow disease at the height of the Christmas season and exports of U.S. beef were stopped in their tracks.

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More than 40 importers of U.S. beef closed their borders to beef and cattle imports since the U.S. Department of Agriculture announced on Dec. 23 that the cow had the disease. Barely three weeks later, the U.S. Agriculture Department slashed estimates for 2004 beef exports by 90%.

Local officials say Mexico can provide residents with all the beef they need, although the restaurant industry says prices could rise as supply becomes tight for American-style cuts of beef if the ban continues for several months. Early signs indicate the mad cow saga will not go away quickly.

Mad cow disease, or bovine spongiform encephalopathy (BSE), is a brain-wasting illness that makes infected cattle stagger around as if drunk as it begins to take its lethal effect.

In humans, where it is rare and is known as Creutzfeldt-Jakob Disease (vCJD), the disease has been linked to some 130 deaths, mostly in Britain, where an outbreak in the late 1990s devastated the cattle industry.

'IT COULD LAST YEARS'

The Washington finding sparked an immediate, international damage control blitz by U.S. officials to persuade countries their beef was safe and that the Washington case was an isolated incident.

The campaign has done little to open borders that slammed shut in late December. Even No. 2 U.S. beef importer Mexico, which has worked hard to patch up relations with the United States since it refused to back the Iraq war last year, is hesitating to open its borders to American beef any time soon.

Agriculture Secretary Javier Usabiaga said in carly January, hours before a visit by U.S. agriculture officials to discuss the problem, that Mexico's ban on U.S. beef "could last months or years."

"There are steps that must be taken, one of which is a risk analysis that needs to be completed by the American government ... to evaluate their indices of contamination and determine up to what point we can talk about an isolated incident," Usabiaga said at a press conference in Mexico City in early January.

Usabiaga somewhat softened these comments later in the month. Following closed-door meetings on Jan. 16 with farm officials from the United States and Canada in Washington, D.C., the agriculture boss said Mexico will partially reopen its border to its neighbor as soon as the U.S. government implements safety measures to prevent the spread of the disease.

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Representatives from the USDA reinforced Usabiaga's apparent change of stance from earlier in January by confirming that Mexico had agreed to open its borders on a limited basis in the very near future.

I'D RATHER HAVE WHALE MEAT

Also in early January, a U.S. mission to Japan, the top U.S. beef importer, was rebuffed even more harshly than the Mexico trip, as Japanese authorities criticized U.S. mad cow testing methods as inadequate.

U.S. cattle prices plunged in January as it became evident that it was going to take time for the world to trust the U.S. beef supply, despite proof that the infected cow came from Canada, which had its first native case of mad cow in May of last year.

The USDA in mid-January cut its 2004 beef export outlook to a little over 200 million pounds, about a tenth the 2.6 billion exported in 2003. Cattle prices for all of 2004 are seen averaging about US$75 per hundredweight, from earlier forecasts of about US$87.50 per hundredweight.

Mexican officials say the domestic cattle industry has neither been boosted nor hurt by the ban on imports from the United States, Mexico's main trading partner and the destination of some US$1 billion in annual beef imports.

NO PRICE HIKE IN MEXICO

Usabiaga said the local beef industry can satisfy domestic demand and added that beef producers had not raised prices as a result of the ban, although local newspapers noted some price rises in local supermarkets.

U.S. Agriculture Secretary Anne Veneman announced in late December six measures meant to prevent the spread of the disease, including a ban on the use of sick or crippled cattle in the human food supply, but Mexico and other countries said they needed more information before border controls are relaxed.

"The [Mexican] Agriculture Secretariat asked authorities from the USDA to provide additional information concerning the time frame for the six safeguard measures to be implemented and complied with," the Mexican government said after its meeting with U.S. officials in Mexico City.

TACO STAND IMPACT

A leader of the Mexican restaurant industry who preferred not to be named said in mid-January that wholesale prices had not yet been affected by the ban, in part because prices had been fixed between suppliers and buyers well before Mexico closed its borders.

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These contracts, he said, would protect restaurants for "several weeks" from price fluctuations, although the ban could affect the industry if it lasts much longer than that.

"But it's the small restaurants, the street stalls, that will likely be affected sooner," he said, referring to the thousands of food stands that dot Mexico's villages, towns and cities and serve meat bought from small suppliers who don't offer wholesale prices.

Analysts are unsure about how long it will take for U.S. beef exports to return to normal, although some are saying at least six months.

Meanwhile, U.S., Mexican and Canadian agriculture officials continue to meet and discuss a concerted strategy as to how to restore consumer confidence in beef, starting with the premise that their economies, integrated under the 10-year-old North American Free Trade Agreement (Nafta), require an integrated solution to the problem.

They agreed there was work to be done before normal trade resumed, and the feeling prevailed that the mad cow saga will provide plenty more food for thought before it is resolved.

George Terrats is a Mexico City-based freelance writer.