Mad cow scare a new beef for Japan stocks
By staff and wire reports
TOKYO, Japan -- The mad cow scare has startled Japan, and concern has spread abroad, with South Korea and Singapore slapping bans on beef imports.
It's yet another beef for Japan's struggling stocks, which are near 17-year lows and may soon see the Nikkei breach the 10,000 barrier.
Japanese authorities confirmed on Monday they had found the first case of mad-cow disease in Japan, a first for Asia.
A slaughtered cow from Shiroi in Chiba prefecture bordering Tokyo, tested positive for the disease, known as bovine spongiform encephalopathy (BSE).
Authorities said there was no danger to milk or meat supply. Still, restaurants and meat companies saw their stocks sell off in Tokyo trade.
Japan has said it has already taken immediate action to deal with the BSE case.
A human variant of the disease kills people by destroying their brain tissue, and has killed around 100 people in Britain since it broke out in the mid 1980s.
The Health Ministry has banned sales of meat products from the farm where the cow was bred, and said the ban could be extended to other farms.
Although Japan is famous for its expensive cuts of beef, it exports very little -- only 358 tons of beef on the bone in 2000 -- and relies on imports for about two-thirds of its beef consumption.
McDonald's Japan stock dips
Shareholders are worrying the discovery might cause consumers to go off meat. McDonald's Co. Japan Ltd., Japan's largest hamburger chain operator, lost 2.51 percent to 3,490 yen.
McDonald's Japan became the first overseas operation of McDonald's to go public with an initial public offering earlier this year. It's the biggest IPO in Japan so far this year.
Rival restaurant chain Yoshinoya D&C Co. saw its stock fall 9.09 percent to 200,000 yen.
Yoshinoya has shaped up as a fierce competitor for McDonald's. It sells bowls of rice sprinkled with seasoned beef strips and onions, and other traditional fare like sushi.
McDonald's said it uses beef imported from Australia or New Zealand, while Yoshinoya said it gets beef from the United States and Australia.
Meat-packing stocks roasted
Japan's meat-industry stocks were even harder hit. Top meat processor Nippon Meat Packers Inc. tumbled 15.18 percent to 1,280 yen.
Japan's largest meat dealer, Starzen Co Ltd., lost 11.52 percent to 169 yen.
Japan was slapped with a cut in its rating outlook from agency Standard & Poor's on Tuesday. But some stock watchers said the mad-cow scare could have a bigger impact.
The broader market largely shook off the S&P downgrade, with the Nikkei rising 0.95 percent to 10,2929.95.
The market had built in the S&P downgrade, which the agency blamed on Japan's slow-moving reforms and which came after a similar move by rival Moody's.
Consumer spending has remained relatively strong in Japan, despite its long-lasting economic languor.
Investors worry that if the mad-cow scare broadens, it could hurt confidence and cause Japanese consumers to change the way they spend.
Japan at risk
Earlier this year the United Nations warned that Japan was at risk because it imported large quantities of meat- based animal feed from Western Europe.
Scientists believe the disease is initially transmitted through infected bone and meat meal fed to cattle.
Japan banned all cattle-related products from the European Union earlier this year, but it had previously imported animal feedstuffs, including meat-and-bone meal, from the region.
Japanese authorities have promised not to keep the public in the dark.
An official panel is to announce soon whether remains of the diseased cow would be sent to specialist facilities in either Britain or Switzerland for further tests.
Scientists believe milk is unlikely to spread the disease.
Reuters contributed to this report.
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