Mad-cow ban cost U.S. $11 billion in beef exports

WASHINGTON (Reuters) - U.S. ranchers and processors lost almost $11 billion in revenue between 2004 and 2007 after major importers barred U.S. beef following the discovery of mad cow disease in the United States, according to a government report issued on Tuesday.

The International Trade Commission said trade restrictions put in place because of mad cow disease cost the U.S. beef industry between $1.5 billion and $2.7 billion in annual revenue between 2004 and 2007. Japan and Korea were responsible for $9.4 billion of the $11 billion estimated in total lost revenue.

Beef shipments from the United States were virtually halted after it found its first case of mad cow disease in December 2003 in Washington state.

Global U.S. beef sales have been edging higher, but not quickly enough for the Bush administration, or for the beef industry, which complain of age restrictions and inflexible import rules.

The ITC said that, while governments will immediately close their borders when food safety concerns arise, it can take several years before the restrictions are lifted.

"The U.S. (Bovine Spongiform Encephalopathy) incident provides an example of this imbalance between imposing and relaxing trade restrictions," the ITC said in a 279-page report.

U.S. officials had hoped a decision last year by the World Organization for Animal Health, which gave the United States a "controlled risk" status for beef safety, would boost beef exports significantly, but it has been slow going.

The U.S. Agriculture Department and others have encouraged trading partners to adopt international beef guidelines by accepting U.S. bone-in beef and meats from cattle of all ages.

Currently, Japan accepts beef from cattle 20 months old or younger, while South Korea limits imports to under 30 months of age.

Max Baucus, a Montana Democrat, who heads the Senate Finance Committee, said more needs to be done by the United States to fully resume beef exports to major trading partners.

"While I'm pleased that Korea is accepting some U.S. beef, it is clear that USDA and (the United States Trade Representative) must redouble their efforts to fully open markets in Japan, China and the rest of the world to safe, delicious U.S. beef," said Baucus, who requested the report from the ITC. "Removing these barriers must be a top priority."

(Editing by Walter Bagley)