From local butchers to national analysts, the beef industry is watching and waiting to see how consumers react to last week’s discovery of a central Washington dairy cow infected with mad cow disease.
So far, "We certainly haven’t seen any decrease," said Jim Horton, the owner of Goetz &Sons Western Meat in Everett.
He and others say it’s too early to tell what the fallout will be.
"Consumers are just waiting to see what happens before deciding how they’re going to react," said Tom Wall, a professor of agricultural economics at Washington State University.
Overseas reaction to the mad cow discovery has been swift. As of Tuesday, 30 nations had banned the import of U.S. beef, including Japan, which is the top foreign buyer of American meat, taking about $1 billion last year.
Those markets will be gone, "till we can prove that either the case is isolated or that it’s under control," Wall said.
That has some in the industry nervous. When mad cow disease — also known as bovine spongiform encephalopathy — was discovered in Canada, it led to a similar series of export bans. Canadian beef prices dropped 70 percent in eight weeks, according to a report from the Utah State University Cooperative Extension Service.
However, that might not be repeated here, according to USU agricultural extension economist DeeVon Bailey.
He said 90 percent of all beef grown in American is eaten by Americans. That means that if U.S. consumers retain their confidence in the product, the industry will be able to eat its way out of any surplus caused by lost exports.
Although beef prices have fallen sharply — by 15 cents a pound in a week — they fell from a historic high, and are still higher than last January.
The price for feed-lot-fattened cattle rose 34.3 cents a pound this year, reaching a peak of $1.09 on Oct. 17, according to Dave Weaber, a beef industry analyst at Cattle-Fax, a Denver-based agricultural research company.
After mad cow was discovered in a Holstein in Mabton, prices fell from 91 cents per pound on Dec. 22 to 78 cents on Dec. 26.
Still, that is a higher price than ranchers saw last January, when fed cattle traded for 74.7 cents a pound.
So far, Horton said, his customers haven’t panicked.
On Tuesday, Goetz &Sons was ready to process and ship about 5,000 pounds of meat to its customers, including 10-pound boxes of hamburger patties custom shaped to the specifications of the restaurants it supplies.
Those customers have called to ask about the safety of the meat they’re getting, and have been satisfied with the answers, said Mike Goetz, the company’s general manager. That’s in part because the company doesn’t use meat from dairy cows in its hamburger and doesn’t use Washington-raised beef at all.
Instead, they use imported bull meat, which they feel has better color and shrinks less when cooked.
Mad cow disease tends to occur in older dairy cattle that get sold to slaughterhouses after they no longer can produce milk, Horton said. The Mabton Holstein was an older dairy cow.
About 30 percent of all beef consumed in the U.S. comes from dairy herds, Wall said, either bull calves that are sold for beef shortly after birth, or older non-producing cows.
There were 45 active dairies in Snohomish County at last count, according to the Washington Dairy Council in Lynnwood.
Selling non-producing cows for beef is important to them because milk prices have been falling to levels close to those 20 years ago, council spokesman Steve Matzen said.
But at the same time, the climbing beef prices had "created an opportunity for dairy farmers to realize some gains," by selling their less-productive cows for beef, Matzen said.
Goetz &Sons was founded by Mike Goetz’ grandfather in 1953, and has never had a food safety problem, Horton and Goetz said. A U.S. Department of Agriculture inspector monitors them daily, and the company has installed its own lab to do tests for bacteria such as E.coli.
Business has slowed this week, Horton said, but that’s typical for the week after Christmas.
Horton said he doesn’t think the mad cow scare will drive away business. The infected cow was older, one of the few still around before feed supplements linked to the disease were banned in North America.
In fact, calls from consumers suggest his business might see a slight increase, as shoppers switch to buying meat from smaller stores that they perceive have tighter control over where their meat is coming from.
"My personal opinion — and yours is as good as mine — is it’s going to be a short-lived thing," he said. "I think the people have confidence in the food safety in this country."
Reporter Bryan Corliss: 425-339-3454 or corliss@heraldnet.com.
JUSTIN BEST / The Herald
Patties come out of a processor Tuesday at Goetz &Sons Western Meat in Everett as Joe Goetz puts more ground beef into the machine.
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