A federal judge in Montana delayed the U.S. government's plan to resume importing cattle from Canada
until a full hearing can be held on allegations the animals pose a risk to public health because of mad cow

U.S. District Court Judge Richard Cebull in Billings, Montana, today ordered the delay at the request of
ranchers who argued the government hadn't done enough to ensure Canadian cattle are free of the
disease, a lawyer for the ranchers said. The U.S. Department of Agriculture planned to ease the ban
March 7 after concluding the animals posed a minimal risk.

''I am very disappointed,'' U.S. Agriculture Secretary Mike Johanns said in an e-mailed statement.
"Today's ruling is not a reflection on the substance of the minimal-risk rule, but rather a procedural delay
while the judge considers the merits of the case.''

Delaying Canadian imports will keep cattle supply tight in the U.S. for beef producers including Tyson
Foods Inc. and Swift & Co., which cut output because of the rising cost of livestock. The Agriculture
Department yesterday estimated Canada would ship 1.3 million head of cattle across the border between
March 7 and the end of the year.

Fattened cattle futures for April delivery rose 0.3 cent to 86.8 cents a pound on the Chicago Mercantile
Exchange after the ruling. Prices were up 12 percent from a year ago. May feeder cattle futures fell 1.65
cents to 98.325 cents a pound, with the most-active contract gaining 14 percent in the past 12 months.
R-Calf Lawsuit

Montana-based Ranchers-Cattlemen Action Legal Fund, United Stockgrowers of America,  as R-CALF, had asked the court to
block the USDA plan, saying it would endanger U.S. livestock, the economy and public health by increasing exposure to mad
cow disease, which has a fatal human form. Its suit was filed Jan. 10.

"Cebull gave the parties 10 days to let him know when they will be ready for a full hearing on the merits of the case,"
Russell Frye, with FryeLaw PLLC in Washington, one of the group's lawyers.

"For the Canadian industry, the best result would have been a rejection of the request on a lack of merit,'' said Ted Haney,
president of the Calgary-based Beef Export Federation. " That didn't happen. We're now into a whole new day.''

The government may appeal the injunction to the Ninth Circuit Court of Appeals in San Francisco. Calls to USDA media
representatives were either not returned or resulted in no comment.

Cebull said that a request for a stay to the Ninth Circuit would not affect his injunction, the Billings Gazette reported on its Web
site. Cebull told the newspaper he wants to hear testimony from experts in order "to clear up some significant issues.''

Disappointed in Canada

In Ottawa, Canadian Agriculture Minister Andrew Mitchell said he was also "disappointed'' with the ruling.

"We have made the case on an ongoing basis that Canadian cattle and Canadian beef are safe, that the regulatory regime in
Canada is an appropriate one. The USDA recognizes that as well,'' he said.

The Canadian Cattlemen's Association called the court decision "a temporary setback.'' In a statement, the group said it
"remains convinced of the merits'' of the U.S. import plan.

Cattle Glut

The U.S. ban has created a glut of cattle in Canada that has cost the livestock industry at least $5 billion ($4.2 billion), the Bank
of Montreal said in November.

The USDA banned cattle and beef from Canada in May 2003 after the country found its first case of mad cow disease, which
is formally known as bovine spongiform encephalopathy, or BSE. The ban was relaxed in August of that year to allow some
cuts of beef from younger animals, though a move to allow live cattle imports was put on hold when the U.S. found its first
case of BSE, in an animal traced to Canada.

The Agriculture Department on Dec. 29 said that as of March 7 it would allow Canada to ship beef from cattle of any age, and
live cattle younger than 30 months, which scientists say are at minimal risk for BSE. The plan later was changed to maintain
restrictions on beef from older animals after lawmakers and meatpackers said the proposal was inconsistent.

Canada last month confirmed its second and third cases of the disease, prompting some U.S. lawmakers to ask the USDA to
scrap the import plan.

"Science supports a far more restrictive and cautious approach to the Canadian BSE problem than the USDA is proposing,'' said
Bill Bullard, the chief executive of R-CALF, which says it has 10,000 members.

In April, R-CALF obtained a court order halting an earlier USDA effort to relax beef import restrictions.

To contact the reporters on this story:

Jeff Wilson in Chicago at:

Christopher Donville in Vancouver at: cjdonville@bloomberg.net.

To contact the editor responsible for this story:

Steve Stroth at

Last Updated: March 2, 2005 18:16 EST
March 2 (Bloomberg) -