Mad cow worries send beef stocks down

The Associated Press

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The response on Wall Street reflected concern over decisions by at least 11 countries to cut off U.S. beef imports, and the potential that the reports might turn consumers away from buying hamburgers and steak.

Several companies heavily reliant on beef consumption lost ground in the shortened day of trading today. McDonald's Corp. fell more than 5 percent to close at $23.96. Wendy's International was off nearly 5 percent at $37.79. Tyson Foods, which relies on beef for nearly half of its business, saw its shares drop nearly 8 percent to $12.90.

Cattle futures dropped sharply in morning trading in Chicago, with steep selling coming to a virtual halt when there were no buyers for future contracts.

Thomas Wahl, an agricultural economics professor at Washington State University, said consumer reaction will likely depend on how widespread the problem is. "Until we know the circumstances of where and how the animal caught the disease, it's premature to speculate," Wahl said. On Tuesday, Gov. Gary Locke encouraged people to continue eating Washington beef, and vowed to eat prime rib for Christmas dinner — though he was a slightly less certain about whether he'd feed hamburger to his two young children. "Beef remains safe for consumption," Locke said. Patti Brumbach, executive director of the Washington State Beef Commission said the threat to human health is low. "I think once consumers understand that the beef supply is safe," she added, "it should be a short-term concern." Busboom noted that Canadian consumption of beef hasn't fallen since the discovery of a mad cow case in that country was announced in May, though the industry lost $1 million a day after bans on Canadian beef went into effect. Since the USDA's announcement Tuesday, at least 11 countries, including Russia, Mexico and Japan, the world's top U.S. beef importer, announced they were halting U.S. beef imports. Colorado, where the beef industry represents more than half the state's agricultural economy, announced a temporary ban on shipping Washington cattle into the state. "I'm not worried about any threat to human health," Colorado Agriculture Commissioner Don Ament said. "I am worried that if people don't understand, this it could have a similar impact to what it had in Canada."

Later today, however, Colorado officials said the ban was over after one day.

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