Year-end report cards on economic growth continue to underscore the depth of the current recovery.
*The government reports that sales of previously owned homes rose to an all-time high last year, thanks to the lowest mortgage rates in decades. *Orders to U.S. factories for durable goods climbed at the fastest rate in a decade. *And though economic growth slowed during the final stretch of 2004, the year-long rate of expansion was the best in five years.
One sector of the economy where that growth was significant was the cattle business. Strong demand spurred by the low-carb diet craze helped beef producers to a profitable year in 2004 ... despite problems on the trade front and in other arenas. To sustain the profitability, the government is working on two fronts: First, to reopen U.S. borders to Canadian cattle; and second, to reopen the Japanese market to U.S. beef.
It's a tricky endeavor, since it appears more than ever that success in one arena relies on success in the other.
A group of Canadian and U.S. industry officials made its case this week for opening the border.
James Hodges, Director American Meat Institute Foundation: "First, make no mistake, we are not facing a BSE crisis in North America."
John Masswohl, Director of International Relations, the Canadian Cattlemen's Association: "We have the same feed ban in place as the U.S. for the same length of time. We've done a couple of things a little different."
One of the major complaints of advocates of the import ban has been about how widespread Mad Cow is in the Canadian herd. Since the 1997 ruminant-to-ruminant feeding ban, studies have been made by the Harvard Center for Risk Analysis.
Joshua Cohen, Harvard Center for Risk Analysis: "The fact that Canada stisfies the minimal risk criteria is important. Our research shows that feed controls, like those implemented in both Canada and the U.S., cause the prevalance of B-S-E to decrease over time and to die out, even when compliance is imperfect."
Based on worldwide numbers, Cohen estimated the risk to US consumers of contracting the human variant of Mad cow at 1 in 100 billion.
Masswohl went on to assure US producers and processors there would be no flood of cattle or processed products once the border opened. He cited recent information showing no huge inventories hiding in Canadian freezers or large groups of cattle waiting in feedlots.
Jim Hodges of the American Meat Institute Foundation was more concerned about the collateral effect of not opening the border might have on US trade with other countries.
James Hodges, Director, American Meat Institute Foundation: "Will we choose free market liberalization of trade based upon sound validated scientific principles or will we retreat to a precautionary protectionist posture that ignores the scientific facts and ultimately damages our standing in the world community?"
Newly confirmed Secretary of Agriculture Mike Johanns had his hands full just working with the Japanese Ambassador this week. A 30-minute meeting was successful only in yielding a working relationship between the two officials. There appears to be no movement on exactly what day the borders will open with Japan.
One of the major stumbling blocks to the restart of trade is how the age of cattle being exported will be determined. The Japanese have made it clear only meat from animals under 20 months of age will be allowed into their country.
No matter what, there is a hole in sales revenues to US producers and processors. 2003 numbers placed sales to Japan at 1.7 billion dollars. And sales losses to Canada are estimated at almost 1.8 billion dollars in processing revenues alone.