Wednesday, September 10, 2008
Prevention Of BSE, Yes, But Has The Loss Of Animal Protein In Livestock Feed Been Worth The Risk?
When the 9/11 terrorists climbed aboard US airplanes, the ease and enjoyment of traveling changed forever. Federal, state, and local policies about citizen identification would never again be the same. Responses to a single event have long tentacles that reach many facets of society, and just like the 9/11 event, the advent of BSE or mad cow disease in the US changed the livestock feed industry forever.USDA economist Kenneth Mathews, Jr., says policies are designed to prevent future animal disease outbreaks, but the outcome will have economic impacts that affect producers, processors, and consumers; and the long term result will be much longer lasting that the immediate economic effects of the disease. In his analysis of the BSE impact on the use of animal protein in livestock feed, Mathews says the impact spread far beyond the cattle and beef industries, “Affected industries include the cosmetic and pharmaceutical industries (both of which use byproducts, such as gelatin and collagen), feed manufacturing industries, and numerous service and manu¬facturing industries (which use other animal byproducts, such as enzymes, triglycerides, and other compounds in the manufacture of fatty acids, paints, varnishes, rubber goods, plastics, and lubricants).”
Bovine Spongiform Encephalopathy, which affects animals, and its human variant form, Creutzfeldt-Jacob Disease, quickly awakened the livestock industry in 1986 and researchers quickly identified the spread of the disease from the use of animal protein and bone meal in livestock feeds. While the disease ravaged the British livestock industry which was forced to burn the carcasses of hundreds of thousands of animals, only a handful of cases have been found in the US, mostly originating from other countries. Early on, the USDA and Food and Drug Administration banned the use of meats and bone meal (MBM) in livestock feeds. MBM had contributed an alternative protein to livestock feeding, and it continues to be fed to non-ruminants such as swine and poultry. The protein element in a ruminant ration is primarily from vegetable sources, such as soybean meal, DDGS, and other protein meal seeds.
When the US banned the use of animal proteins in ruminant rations in 1997, only small amounts were being fed because of the high costs. In Europe, where there is an inadequate supply of soybean meal, a greater amount of MBM was being fed until 2001. Economists determined that “the 2001 EU ban against MBM in any animal feed would cause the EU to import an additional 1.5 million more tons of soymeal per year to replace meat and bone meal in livestock feed rations.”
Economist Mathews says following the US ban in 1997, MBM declined in price from $431 per ton to $187 per ton in March 1999. The loss of a product to sell was estimated to have cost the rendering industry between $24 and $48 million. Since, USDA has calculated a $53 million impact on private industry, $171 million in lost value of products to the rendering industry, and a gain of $163 million to producers of non-ruminant animals from lower feed costs. Then prior to the FDA’s new rules in 2004, prices recovered to nearly $400 per ton; but fell again to $187 after the new regulations were issued. Those required slaughter houses to find new uses or disposal for the nerve tissues banned from consumption. That lead to a reduction in revenue for producers and processors of beef products and by-products. Mathews says if all MBM were banned from livestock feeds, prices for other protein feeds would increase by 100%.
Currently, very little MBM is being used in any livestock feed. While the original 1997 ban on MBM reduced availability of protein feeds by 13%, MBM use only constitutes about 8% of protein meals currently, so a complete ban would not likely result in a 100% rise in costs for animal protein feed users. Mathews estimates the increased costs for a beef steer to be as high as $23.61, but when the final rules were released earlier this year, the cost was expected to be lower.
In addition to feed costs, other impacts of the rule include charges by renderers for picking up carcasses, and a nearly $20 per head cost of disposal of unusable carcasses from animals that die at or approaching the slaughter plant.
Mathews reminds not to forget the benefits of the ban on MBM use, which is a reduced incidence of BSE and its human variant form. However he says there have only been some marginal benefits and questioning the trade off is a question that is asked more frequently.
Summary:
BSE or mad cow disease caused government policy makers to ban the use of animal proteins and bone meal in the rations of ruminant animals, but they can remain as part of a non-ruminant ratio. Increasing restrictions of MBM has caused higher costs of animal feed with the loss of a competitor, and the loss of products made from MBM by many industries.
Posted by Stu Ellis on 09/10 at 01:57 AM | Permalink