Texas

Concerns over BSE-contaminated beef in Europe could lead to increases in U.S. beef exports within the next two years. Parr Rosson, an economist with the Texas Agricultural Extension Service and the director of the Center for North American Studies, says beef consumption within the European Union has been reduced by approximately 50% in the last three months, followed by a 35% reduction in retail prices for beef as a result of BSE, also known as "Mad Cow" disease.

"In the near term, we might pick up some extra markets where European beef was previously shipped and now is banned because of the presence of BSE (Bovine Spongiform Encephalopathy)," Rosson said.

"(This is) most likely (to occur) in North Africa, the Middle East and possibly in some of the Asian markets. Longer term, the second impact could be that we'll see herd rebuilding occur in many parts of the European Union."

World wide, approximately 182,000 head of cattle have been slaughtered because of BSE, with the United Kingdom the center of the BSE outbreak and having the most cattle slaughtered.

Rosson noted there could be an attempt to store frozen slaughtered beef that has been tested and declared BSE free, which possibly could negate the potential alternative export markets for U.S. beef. Current regulations state that if an animal is found to carry BSE, then all of the animals in that same herd must be slaughtered.

"And in Germany, they're looking at the immediate slaughter of 400,000 head with longer term prospects with slaughter of up to 2 million head," Rosson said.

"So that could have quite a significant impact on the ability of the European Union to supply its own needs." Rosson says this is coming at a time when Eastern European nations are beginning to emerge as significant beef consumers.

"Before this they relied on the European Union for their supplies. Now it appears the U.S. might be in a position to move in and meet some of that demand in Central and Eastern Europe," Rosson said. This is expected to occur within the next 18 months to two years, according to Rosson, because of large supplies and current contracts. He said beef supplies are adequate for eight to 12 months and that it will take a year to slaughter those supplies.

"Once the disease is isolated and once they feel it is under control, then I believe that it will be possible for the European ranchers to go back in and rebuild," Rosson said.

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