Good morning and thank you all for joining us. I'm Cindy Smith, the Administrator of the Animal and Plant Health Inspection Service.

As you all know, we are here to announce USDA's final rule to normalize trade with countries recognized as presenting a minimal risk of introducing bovine spongiform encephalopathy, or BSE.

We are confident in taking this important step to normalize cattle trade with Canada, while continuing to protect the health of the U.S. cattle population. It is an integral part of our efforts to promote fair trade practices, consistent with international guidelines. And we will continue to encourage other countries to also align their trade requirements with these science-based international standards.

I have with me USDA's Chief Veterinary Officer Dr. John Clifford. Dr. Clifford will be giving some brief remarks and then we will open the floor up for questions from the media.

John . . .

Thank you, Cindy.

This morning USDA published a final rule that will harmonize cattle trade with countries presenting a minimal risk of introducing BSE into the United States.

The rule expands upon a rule published by USDA in January 2005 that established conditions for the importation of live cattle under 30 months of age and certain other commodities from regions with effective BSE prevention and detection measures.

That rule also designated Canada as the first minimal-risk country recognized by USDA. The expansion of that rule is a major step in facilitating fair, science-based trade while continuing to protect animal health in this country, consistent with international standards as defined by the World Organization for Animal Health, also known as the OIE.

Specifically, this rule allows for the importation of: cattle and bison for any use born on or after March 1, 1999 -- the date determined by USDA to be the date of effective enforcement of the ruminant-to-ruminant feed ban in Canada; blood and blood products derived from bovines, collected under certain conditions; and casings and part of the small intestines derived from bovines.

Today's final rule also lifts a delay imposed in March 2005 on meat and meat products from bovines older than 30 months of age.

Meat and meat products from bovines older than 30 months of age will be allowed, provided specified risk materials are removed prior to importation.

Before finalizing this rule, APHIS sought public comment and encouraged the public to participate in the decision-making process. We issued a proposed rule at the first of the year and the public comment period opened January 9, 2007 and closed on March 12, 2007.

In addition to making the proposed rule and all supporting documents available for review and comment by the public, APHIS also requested an external, formal, independent peer review of the risk assessment. The objective of the peer review was to determine whether the risk assessment was scientifically sound, transparent and consistent with international standards.

The review was conducted by recognized experts in the field and was consistent with guidelines established by the U.S. Office of Management and Budget. An independent contractor coordinated the peer review.

All of the peer reviewers agreed with the risk assessment conclusion that the likelihood of BSE becoming established in the U.S. cattle population by allowing additional commodities from Canada is negligible.

All reviewers noted that many of the assumptions in the risk assessment actually represent worst case scenarios, so the overall findings were reasonable. The peer reviewers also agreed that the risk assessment followed OIE guidelines and standards and furthermore, the reviewers acknowledged the scientific rigor of the assessment in terms of using existing literature and models appropriately and making sound assumptions.

APHIS incorporated several clarifications and updates suggested by the reviewers. The changes improved the transparency and accuracy of the document but did not alter APHIS' original conclusion, which the reviewers concurred with, that the risk of BSE establishment in the United States resulting from the changes outlined in the rule is negligible.

In our risk assessment, we carefully considered all of the steps in both Canada and the United States that would have to occur for BSE to spread to an animal here in the United States. The risk assessment acknowledged that BSE is present in Canada and that there likely would be additional cases identified in the future, and we still concluded that these imports would present a negligible risk of establishment of BSE in the United States.

If an infected animal from Canada were to be imported into the United States, a series of multiple safeguards would prevent the disease from being transmitted to another animal.

I would like to go through a couple of points that we considered as we developed the final rule and supporting documents. I know that many of you are aware that Canada has identified two cases of BSE since the proposed rule was published. We did consider this as we developed the final rule.

In addition, we received comments that indicated that our initial import projections, especially for the numbers of older cull cattle, were too high. We also considered this point as we developed the final rule. Let me explain a bit more about each of these, especially as they tie in to either our risk assessment and/or the economic analysis.

We analyzed the issue of BSE detections to make sure that our risk assessment was broad enough to have already considered such occurrences. As I'll explain in a minute, the conclusions of our original risk assessment were not changed by these additional considerations.

At the time the proposed rule was published, Canada had documented nine native BSE cases. All of these cases, along with the negative surveillance data from the same time period, were considered in the prevalence estimate used in the original risk assessment. Let me remind you that this prevalence estimate was derived using the same methods that we recently used to estimate the prevalence of BSE in the United States.

These methods used a comprehensive model that incorporates information about the cattle population and the science of BSE to provide a robust estimate of the true prevalence of disease in the current adult cattle population. This estimate accounts for both undetected and undetectable cases of BSE.

We added the data from the two additional cases to the model, without including negative surveillance data from the same time frame. With the two additional cases, the prevalence estimate was still within the confidence intervals, which means it fit within the range of our initial prevalence estimate - thus demonstrating that our initial estimate was very solid.

The second issue I mentioned were our projections of the numbers of older cattle that might be imported for slaughter. We received information during the comment period that indicated our estimates of the number of cull cattle for immediate slaughter were too high, due to the issue of age verification.

The number of these older animals that can have their ages verified, meaning confirmation that they are born on or after March 1, 1999, is limited. Therefore, we updated our import projections to reflect this fact, in both the economic analysis and the risk assessment. While the number of older cattle for slaughter dropped in these revised projections, the overall number of imports over the 20 year time frame of the risk assessment remained essentially the same.

We explain both of these points in more detail in the updates section of the risk assessment. We also note that, because these points do not significantly impact either our initial prevalence estimate or the import projections, we have not redone the quantitative model used in our exposure assessment, and our original conclusion remains the same - that the risk of BSE establishment in the United States resulting from these regulatory amendments is negligible.

We are committed to ensuring that our regulatory approach keeps pace with the body of scientific knowledge about BSE and this is an important move in our efforts to promote fair, science-based trade practices. USDA is confident in taking this next step while at the same time protecting American agriculture and maintaining confidence in the U.S. beef supply not only here in the United States but with our trading partners.

Thank you again for calling in. We will now move to the question and answer portion of the call.

Thank you again for calling in, and we will now move to the question and answer portion of the call, and then before that I'll turn it back to Ed.

MODERATOR: Hello everyone, this is Ed Curlett with APHIS Public Affairs. Before we begin the question and answer portion, I would like to remind everyone that this call is for media. Stakeholder questions will be addressed during meetings later today. Reporters, please limit yourself to one question so we can get as many as possible in. And please identify your affiliation when asking a question. In addition to Dr. John Clifford, we have a few other people in the room to assist with questions. Dr. Lisa Ferguson with APHIS's National Center for Animal Health Programs is here. Additionally we have from USDA's Food Safety and Inspection Service Dr. Daniel Engeljohn, Deputy Assistant Administrator for the Office of Policy Program and Employee Development.

With that, Operator, we are ready for questions.

OPERATOR: Thank you. At this time if you would like to ask a question, please press *1. You'll be prompted to record your first and last name to introduce your question. To withdraw a question, press *2. Our first question comes from Steve Kaye with the Cattle Buyers Weekly. Your line is open. You may ask your question.

REPORTER: Good morning. Firstly, what's the economic impact, if any? I'm sure it's in your analysis. And secondly, what restrictions still apply from late 2003?

DR. CLIFFORD: The restrictions that would still apply for late 2003 is, this rule did not address the issue of sheep and goats. Then in addition, with regard to the economic analysis we would recommend that you look at the economic analysis on the website that was posted. There was a positive result from that, from reopening trade with regards to the economic analysis. There's one other thing that was not allowed in addition from the 2003, and that has to do with rendered protein.

OPERATOR: Our next question comes from Bill Tomson. Your line is open. You may ask your question.

REPORTER: Yes. Thank you. It's Bill Tomson with Dow Jones. There was an earlier assessment that once the border was open, and now it is, that there would be 610,000 head of these older cattle, these over 30-month-of-age cattle coming across the border, a year. Is that still the estimate? And how long do you think from today it will take before those animals start coming across the border?

DR. CLIFFORD: Bill, actually, as I indicated in my opening remarks, and based upon the issue of dentition and the evaluation of age of older animals, we actually in the original you were talking about the 650,000-some head of cattle. We believe that number in the economic analysis would be around 75,000 head. The actual effective date of this rule would be November the 19th. It actually will go into the Federal Register on September the 18th, so if the effective date is November the 19th it would open up after that date.

OPERATOR: Our next question from Beth Gorham. Your line is open, you may ask your question.

REPORTER: Hi, there. It's Beth Gorham from the Canadian Press. Just following on that, so it wouldn't actually open on the 19th. It would have to open on the 20th?

DR. CLIFFORD: I think the effective date was November the 19th. So it should be the 19th.

OPERATOR: The next question is from Ron Frizon (sp). Your line is open. You may ask your question.

REPORTER: Hi. This is Ron Frizon from the Manitoba Cooperator. Do you expect RCALF to apply for an (unclear) rule, and what are your feelings about their success given the previous record of this organization?

DR. CLIFFORD: I can only respond to that, and I'm not sure what any organization may or may not do with regard to this.

MODERATOR: Next question?

OPERATOR: Christopher Gehring, your line is open. You may ask your question.

REPORTER: Thank you for taking my question. I want to see if you guys could tell me more about Congress. I understand that there's a potential that Congress could somehow step in and take some legal steps to affect the outcome. Is there any concern about that happening?

DR. CLIFFORD: Operator, can you have Chris repeat that question? Chris, we didn't hear you that well.

REPORTER: Sure. I just wanted to see if there's any concern that Congress could step in, given the concern from some groups, and potentially put a block to this lifting of this ban entirely moving forward?

DR. CLIFFORD: With this type of rulemaking process, obviously Congress has 60 days to review that. I wouldn't want to discuss what reaction Congress may or may not have to this rule. However, we feel this rule is very much scientifically based and the risk is very negligible with regards to introduction of BSE into the U.S.

OPERATOR: Sally Schuff, your line is open. You may ask your question.

REPORTER: Yes. Hi. This is Sally Schuff with Feedstuffs. Can you define, my question is for Dr. Clifford, can you define the SRMs that are required to be removed from the meat coming in?

DR. CLIFFORD: From under - basically Canada is exactly the same as the U.S., from under 30 months you're talking about tonsil and distil ileum. Over 30 months, you know it's the brain, spinal cord, there's a number of additional items.

OPERATOR: Next question from Gina Teal (sp). Your line is open. You may ask your question.

REPORTER: It's Gina Teal from the Calgary Herald. Other than the birthdate involved, what are the other import restrictions and protocols associated with Rule 2?

DR. CLIFFORD: One, the birthdate these animals would be allowed in for any purpose or use. There is a requirement that they would be identified with an ear tag. They would also have to have permanent identification such as a tattoo or a brand unless they are going to direct slaughter. Those moving to direct slaughter would not require a permanent identification because those animals are monitored in sealed trucks for that direct slaughter movement.

OPERATOR: Chris Clayton, your line is open. You may ask your question.

REPORTER: Dr. Clifford, do you also have any idea about, given the change with overall beef how much increased tonnage that would move into the country from Canada. And the economic assessment that I see on your website seems like it has not been updated since 2006, so that would seem - I don't see a difference in terms of numbers of head of cattle coming south across the border how the numbers would change on the economic analysis.

DR. CLIFFORD: Chris, I couldn't understand the last part of your question. Can you repeat that?

REPORTER: You mentioned the different number. You lowered that number from 610,000 to potentially 75,000 of head. Just from looking, what I see on your website it seems like that the economic analysis is older, that maybe it had not been updated to include those maybe changes in numbers.

DR. CLIFFORD: Chris, those should have been posted at 11:00 today. And I think we'd make sure you have the most updated information with regards to that because we definitely did change that based upon the information, the data we received during the comment period.

OPERATOR: David Irvin, your line is open.

REPORTER: David Irvin from the Arkansas Democrat Gazette calling. The question I have, you indicated in your opening remarks that this is an important move to promote fair science-based trade with our partners. To what degree did considerations with South Korea and Japan play into this entire process of reviewing the BSE requirements?

DR. CLIFFORD: Actually, with regards to this, as I indicated this is science-based, it's based upon international standards, and the USDA has not changed its position. We expect our trading partners to follow the same science that we follow with regards to this.

OPERATOR: Alan Bjerga, your line is open. You may ask your question.

REPORTER: Yes. Alan Bjerga from Bloomberg News. Following on that, has conversations about the lifting of this already been a part of some of the talks you've been having with South Korea, Japan and other countries?

DR. CLIFFORD: I know that our trading partners were aware of this particular rule. In fact, you know, a number of countries had the opportunity to make comments on the proposed rule itself. So they are certainly aware, and they are also aware of our position that as many of those countries are also members of the OIE, the World Organization for Animal Health, we have the expectation that all countries will establish and follow the OIE with regards to trade and safe trade for BSE.

OPERATOR: Chuck Abbott, your line is open. You may ask your question.

REPORTER: Thank you. I'm wondering what's happening on what might be viewed as the companion measures to this, the revisions to the U.S. Feed Ban. That has been sitting at FDA for almost uncountable months now, and has been raised as a point of concern for trading partners.

DR. CLIFFORD: FDA, as you know, is responsible for the promulgation of the feed ban rules. We worked very closely with FDA as well as Food Safety Inspection Service, which is part of USDA, on the entire BSE issue. But with regards to further action on that rule, I would request that you direct your question to FDA.

OPERATOR: Next question from Lee Melkey. Lee, your line is open; you may ask your question.

REPORTER: Yes. Lee Melkey with Dairy Line Communications. I assume this November 19th opening would include dairy heifers. And secondly, I know that National Milk has voiced concern over the economic implications and has charged that USDA has not done due diligence in assessing the economic implications to the U.S. dairy industry of this action.

DR. CLIFFORD: I mean, it sounded like more like a comment. We're certainly aware of that concern and issue raised by that. But basically, you know, I would recommend that you look at the economic analysis with regards to the impact with regards to reopening the border would have. And I think most importantly, I think it's important to note that regardless of whether we're talking about breeding or animals for feed and slaughter that it's safe to come in. The risk is extremely low.

OPERATOR: Our next question from Jim Webster. Your line is open.

REPORTER: A follow-up on that, Dr. Clifford. National Milk suggested that the impact was cursory because it really didn't look at the total effect on dairy farm income. They estimated for instance the number of heifers, 47,000; increased milk production and reduced farm milk prices by 18 percent, dairy farm income by $5 billion. Do you agree with that estimate? Or did you make any change in the impact statement from January?

DR. CLIFFORD: Actually, we did respond to concerns raised by the dairy sector, and we did not expect imports of dairy animals from Canada to add significantly to the U.S. national herd.

OPERATOR: Our next question from Jim Dickrell. Jim, your line is open. You may ask your question.

REPORTER: Jim Dickrell with Dairy Today, and the previous two questioners asked the questions I had. Thank you.

DR. CLIFFORD: Can you repeat that, sir?

REPORTER: The answer, the questions have been answered that I had. I'm sorry I didn't get out of the queue in time.

OPERATOR: Our next question is from Blair Andrews. Your line is open.

REPORTER: Yes. Blair Andrews from the Ontario Ag Radio Network. I'm looking for some clarification on the age issue. Again, how are the age of the animals going to be determined, and what would be required from a Canadian exporter?

DR. CLIFFORD: Actually, with regards to the age issue, we depend upon the government of Canada to make sure, verification of the age. That can be done in more than one way. Actually you can use dentition for certain aged animals. As you get into older animals though, you would be looking for documentation to support that age.

MODERATOR: Operator, we have time for two more questions.

OPERATOR: Ryan Barrett, your line is open.

REPORTER: Hi. This is Ryan Barrett, Canadian Jersey Breeder Magazine. I just wanted to know if you had any estimates in terms of the number of dairy heifers that you would expect to be coming down from Canada. Originally it's been somewhere around 60,000. Do you expect it to be significantly lower than that?

DR. CLIFFORD: We would actually consider it to be about somewhat similar to what it previously was, is what really basically was our conclusion.

OPERATOR: Our last question from Carol Sugarman. Your line is open.

REPORTER: Oh, hi. This is Carol Sugarman from Food Chemical News. I was just wondering how many comments you received on this proposed rule, and if you could provide a general idea of what percentage were for and against it.

DR. CLIFFORD: Actually the comment numbers were about 400, but I just would briefly say and summarize you know there were individuals that were for it and groups that supported it, still providing some recommendations for change. There were groups that were against it and also provided. So you know there was a whole range, so it's not appropriate I think to try to break each one out. So.

MODERATOR: Operator, thank you very much. This is Ed Curlett. I'd like to encourage everyone to go to WWW.APHIS.USDA.GOV to see the documents associated with this announcement today. Additionally, if you have further questions, feel free to contact Karen Eggert at 301-734-7280, or Andrea McNally at 202-690-4178. Again, go to the website for more information. And we'd like to thank everyone very much for listening in on the call today. Thank you.