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Slower time of year for many meatpackers

By ROXANA HEGEMAN
AP Farm Writer

WICHITA, -- Still struggling through the aftermath of the nation's first confirmed case of mad cow disease, three of the country's four major meatpackers said Monday that a second suspected case hasn't caused more cutbacks in their already reduced production schedules.

Simply put: In an era of historically low numbers of cattle roaming the range, there is just not much bad news left that can shock a system already battered by the loss of its major overseas markets.

''You can't reclose the Japanese border. It never reopened, so that effect has already happened,'' said Mark Klein, a spokesman for Cargill Inc.'s Excel Corp., the nation's second largest meatpacker. ''We continue to be affected primarily by the availability of cattle. That is the main driving force in the market right now.''

Of the nation's four major meatpackers, only Kansas City, Mo.-based National Beef Packing Co. has blamed production cutbacks on the announcement of a possible second case of mad cow disease. Wichita-based Excel, Tyson Foods Inc. and Swift & Co., said Monday that cutbacks at their slaughterhouses have been in place for months.

''(They) will continue to do so because of challenging market conditions, which include the continued absence of key export markets, tighter cattle supplies and softer domestic beef demand,'' said Gary Michaelson, a spokesman at Springdale, Ark.-based Tyson.

Combined, the four meatpackers control most of the domestic market.

Tyson usually runs its slaughterhouses 48 hours a week, but has reduced production hours at most plants to between 32 and 36 hours per week, Michaelson said. The company, which cut fewer than 40 workers nationwide after the discovery of the first U.S. case of mad cow disease, has no plans to cut additional workers.

At Excel, which cut nearly 600 jobs nationwide after export markets closed following the first mad cow case, also has not cut any more jobs. The company hasn't cut back production hours, Klein said, but has slowed down its production line, reducing the number of cattle processed daily.

National Beef, the nation's fourth-largest meat processor, told an industry trade publication, Meatingplace.com, it would reduce production hours in its plants immediately in the wake of the discovery of the second possible case of mad cow disease. Neither National Beef or its parent company, U.S. Premium Beef, returned calls from The Associated Press on Monday seeking comment.

Officials at Tyson, Excel and Swift all said Monday that the industry has been struggling for months, primarily due to the dwindling number of cattle available to butcher. That's also a product of mad cow; the shortage has been most acute since the United States closed its borders to live cattle imports from Canada after the discovery of the disease in that country.

Mad cow disease, or bovine spongiform encephalopathy, attacks an animal's nervous system. People who eat food contaminated with BSE can contract a rare disease, variant Creutzfeldt-Jakob disease, that is usually fatal.

So far this year, the nation's meatpackers have butchered 8.7 percent fewer cattle than a year ago, said James Mintert, an agriculture economist at Kansas State University. Canada imported 1.7 million live cattle into the United States in 2002, the last full year of imports. Canadian cattle comprised 5 percent of the U.S. slaughter that year.

The May 2003 decision to close the border to cattle imports from Canada came when the U.S. cattle inventory was already at a historically low level. The 94.9 million head of cattle counted on Jan. 1, 2004, was the smallest inventory on record since 1959, Mintert said.

''When you put the total picture together, yes, it is a scramble to obtain enough cattle to operate a cattle slaughterhouse efficiently,'' Mintert said.

At Greeley, Colo.-based Swift, spokesman Jim Herlihy said the company is watching consumer reaction to the latest suspected mad cow case. But the meatpacker has already been operating a reduced production schedule for much of the year.

''This is typically a slower period of the year anyway; with the holidays, a lot of poultry consumption is up,'' Herlihy said.