ANNOUNCER: "Good morning. I'm Larry Quinn speaking to you from the Broadcast Center of the U.S. Department of Agriculture in Washington. Welcome to today's news conference with Secretary of Agriculture Mike Johanns to discuss the Ninth Circuit Court ruling on Canadian cattle trade. The Secretary also will discuss meetings he's held this week with government officials in China and Africa.

"Joining the Secretary from here in Washington is USDA chief veterinarian Dr. John Clifford.

"Reporters, I would remind if you have questions later on for the secretary or Dr. Clifford please press "1" on your telephone touch pad to alert us.

"And now by live connection from Madagascar, here is Agriculture Secretary Mike Johanns."

SEC. JOHANNS: "Larry, thank you. And hello to everyone. There are a number of topics I will cover in this call, so I'll just go ahead and get started.

"First I do want to start with the ruling relative to the Canadian beef industry. We will be moving as expeditiously as possible to begin importing Canadian cattle. But of course we will do so carefully to ensure that the minimal risk rule criteria are clearly met.

"There are three steps underway to move the process forward. The first step is that USDA's Animal and Plant Health Inspection Service will issue standard operating procedures to all APHIS field offices, the Canadian Food Inspection Agency, and the U.S. Customs and Border Protection Offices.

"Secondly, USDA's Food Safety and Inspection Service will issue updated lists of approved products that will be allowed across the border and instruct personnel who will inspect cattle received for immediate slaughter at FSIS inspected establishments.

"The third area, USDA is communicating with state veterinarians, U.S. importers, U.S. port officials and Canadian officials to ensure all criteria for importing are clear and all systems are in place to properly inspect shipments and ensure the minimal risk rule criteria are met.

"Now once these steps have been taken, here's a general process that will be followed when shipments of live cattle and other ruminants resume. Canada will issue health certificates to verify the age and identification of the animal and ensure it meets minimal risk rule criteria.

"Secondly, the U.S. Customs and Border Protection will receive the documentation and confirm the shipments are appropriate for entry in the U.S., then release two APHIS veterinarians at inspection facilities at the borders.

"Third, APHIS veterinarians will inspect the cattle and verify that the minimal risk rule criteria are met. They'll validate Canadian certification.

"And fourth, FSIS inspection personnel will verify that U.S. requirements are met at the point of slaughter.

"We have been of course in contact with our counterparts in Canada working through these issues, and we'll be working through this process immediately and in the days to come.

"Some quick points on our trip overseas. We are about three-fourths of the way through this major trip. We had good deliverables from our work in China at the JCCT [Joint commission on Commerce and Trade] team meeting we did secure approval of the biotech corn. China has agreed to send to the United States a BSE technical team, and we are anxious to work with China in preparing for that team to come to the United States. That was good news.

"And we executed a SPS Agreement to minimize trade disruption and we also talked with China at great length about the WTO meeting.

"In reference to the WTO meeting in Dalian, I did participate in that meeting. And that meeting I think went well. There's still a tremendous amount of work to be done. But I think the meeting was worthwhile, and there does seem to be a solid commitment by all participating nations to move that WTO process forward.

"I am in Madagascar now. It is a very important country to us. It is the first to receive dollars through the millennium challenge. We are working with Madagascar and agricultural development and markets. Many of the things that they are doing in Madagascar we're very excited about. It's a country that has enjoyed stable government since the new president took office in 2002. They are fostering an atmosphere of democracy and economic growth for their citizens.

"From here tomorrow we go to the AGOA forum and I will be speaking at that forum, and the purpose of that meeting is to do everything we can do to encourage development in Africa. So I look forward to that meeting.

"There has been a lot of discussion about my meeting with the minister of agriculture from Japan. I did meet with him. I indicated to him that we have been very patient in working with them to get through their process. But I believe it is time for that process now to come to an end. I indicated to him that the patience of Congress is bound to run out at some point, and my hope is that we can expeditiously move through the remainder of the Japanese process and resume trade in beef with Japan.

"Very clearly the ruling of this week indicates that we are going to approach these issues based upon sound science as we've explained so many times with Japan, especially recognizing that we're dealing with animals 20 months and younger. The science very definitely is on our side, and it's time for them to reopen their borders and start receiving American beef.

"With that, I'd be happy to take any questions, and as indicated Dr. Clifford is with me to answer any process questions."

ANNOUNCER: "Reminder to reporters, please press "1" on your telephone touch pad to indicate that you wish to ask a question. And our first question today will come from Chris Clayton from the Omaha World Herald. Chris, go ahead with your question, please?"

REPORTER: "Thank you, Secretary, for taking the questions. I'd like to know first do you have a date set for opening that border? And secondly, what has been told to you about the potential now, what happens to this court case in Montana? Does it essentially go away because of this ruling?"

SEC. JOHANNS: "On the first question, Chris, we have not set a date although Canada anticipated that these requirements would be there at whatever time we got a favorable ruling. We anticipated those requirements. So our hope is that we're talking about days and not weeks. It could be as early as next week, but we do want to make sure that everything is in place, that we're prepared for all of the requirements. And so that's what we've been working through.

"If things go well, it could very well be next week, but we haven't set a specific date.

"In terms of the ruling, there is still the hearing before Judge Cebull. You know, the decision on whether the case continues is in RCALF's hands. But we will be prepared to be in his courtroom, and we'll be prepared for the remainder of the case if that is necessary."

ANNOUNCER: "Our next question comes from Libby Quaid from the Associated Press. And standing by would be Randy Fabi. Libby, go ahead, please."

REPORTER: "Mr. Secretary or Dr. Clifford, can you say if USDA or APHIS or even FSIS will be posting updates on the Canada border situation as APHIS has been doing in its ongoing BSE investigation?"

SEC. JOHANNS: "Doctor, can you handle that?"

DR. CLIFFORD: "Yes, Mr. Secretary. Yes, we would be obviously (off mike) [inaudible]. We will be updating our fact sheet with regards to the minimal risk rule and be putting those updates on our website."

SEC. JOHANNS: "Okay. Randy?"

ANNOUNCER: "Randy, go ahead with your question, please?"

REPORTER: "Yes. Mr. Secretary, I wanted to get your reaction if I could in regards to criticism by Japan's Food Safety Commission, which earlier today criticized the U.S. mad cow safeguards as inadequate. Also as a second question, do you see cheaper beef prices for U.S. consumers due to this ruling?"

SEC. JOHANNS: "On the first question, you know I thought about what they are saying, and I must admit it doesn't make a lot of sense to me. And here is why. Japan has now recorded; I believe their 20th BSE case. Their animals are older animals. The animals that we will start importing into Japan are 20 months and younger, and there just isn't a situation where you'd find BSE in an animal that young.

"So what they're saying doesn't make a lot of sense to me. Under what we're proposing with Japan, what they're saying just, there just isn't a possibility that that would occur. You're not going to find BSE in animals 20 months and younger.

"In terms of beef prices, there are so many factors involved in what the price of beef would be it's impossible to tell, and I'd hate to even venture a guess about that because that's what it would be. It would be a guess on my part, and I really don't want to do that.

"Next question?"

ANNOUNCER: "Our next question comes from Don Wick of Red River Farm Network. And he'll be followed by Peter Schinn. Don?"

REPORTER: "Mr. Secretary, you said in the past that the border closing was resulting in a restructuring of the North American cattle industry, the packing industry. Do you think with this announcement from the courts that we can reverse that or maintain the packing industry here in the states?"

SEC. JOHANNS: "I believe we can maintain the industry. There is a certain amount of restructuring that has occurred that will be very difficult to reverse, and I made that statement before the ruling came out on a number of occasions.

"You know, the jobs that were lost in Gering, Nebraska, you know whether they would come back or not would totally be a company decision. But you just worry that those jobs may not, whether it's Gering or some other part of the country.

"Estimates were out there. I don't believe they were our estimates, but there were estimates out there that about 8,000 jobs were impacted, and I'd just worry that many of those jobs are impacted in a very permanent way.

"You know, now that we have a ruling on the Appellate Court, my hope is that that restructuring now will be abated, and this industry can now start getting back to a normal flow of commerce here."

ANNOUNCER: "Our next question comes from Peter Schinn from NAFB, and he'll be followed by Kimberly Haucus (sp). Peter, go ahead."

REPORTER: "Well, thank you very much for taking my question. Mr. Secretary, I have a question for you and then a question for Dr. Clifford. You mentioned some optimism about the WTO mini-ministerial in Dalian , and I just wanted to know how optimistic you feel about that.

"And then for Dr. Clifford, if he has an update on the epidemiological investigation of the most recent case of BSE?"

SEC. JOHANNS: "No, I am optimistic. The countries that were there at that mini-ministerial to the country expressed a real desire to get an agreement. And that is always a very positive sign. There was good discussion about the right approach and although there continues to be debate and even disagreement about that, it was encouraging that countries were very, very engaged.

"I think the concern for everyone is there's just plenty of work to be done. Each day that goes by brings us closer to the Hong Kong meeting, and a lot needs to be done between now and that meeting in December.

"But I'm encouraged. I came away with a notion that if everybody stays focused this is doable, and we can get a good reform-oriented agreement in Hong Kong.

"Doctor, do you want to give us an update on the epidemiological report?"

DR. CLIFFORD: "Yes, Mr. Secretary. As we previously indicated and put up on our website, we completed the work in the initial herd [inaudible] actually sampled 67 animals or cattle of interest, and all of those were negative on our [inaudible] and we're continuing the epidemiology with regards to trace outs of herds, and soon as we have that we'll be ready to report on that. But it's not completed as of yet."

SEC. JOHANNS: "Next question?"

ANNOUNCER: "Kimberly Hauca (sp) from Global TV is next. Keith Merkx should be standing by. Kimberly?"

REPORTER: "Yes. Mr. Secretary, I have a question to follow up to the first question you answered. This ruling is on the preliminary injunction, but in a few weeks there will be another hearing, and you said that you'll be prepared to deal with that. But my concern is and I'm wondering, do you have a fear that you'll be giving out that animals will be ready to come into the border only to be possibly sent back again? And if so how would you deal with that?"

SEC. JOHANNS: "We will deal with it, first of all, in a legal manner. The Ninth Circuit has issued its ruling, and the ruling was very clear. And so as I had indicated in the past, with that ruling we are ready to proceed.

"Secondly, of course we always deal with these issues in a scientific manner. We have argued all along that this rule is carefully constructed, thoughtfully put together based upon a thorough risk analysis, and science was on our side. And so we will make that case again before Judge Cebull if that's necessary. And again, we believe that the work was done to lay the platform for the validity of this rule.

"And of course we're very encouraged by the decision of the Ninth Circuit, but if there's more legal process ahead we'll be prepared to deal with that."

ANNOUNCER: "Our next questions comes from Keith Merkx from Texas State Network. And standing by should be Philip Brasher. Keith, go ahead, please."

REPORTER: "Thank you, Larry.

"Mr. Secretary, this sort of expands on some of the previous questions, especially the last one there. Really no reason to believe that a week from this coming Wednesday Judge Cebull won't lay down another permanent injunction this time against the Minimal Risk Rule. Does that mean we might have to wait another four or five months before the Ninth Circuit gets around to reversing it again? How does that work?"

SEC. JOHANNS: "Well, again we'll be prepared for whatever is out there from a legal standpoint. You know in terms of how it works, he has set a hearing. You know, assuming that the case continues we'll be prepared for that hearing. We'll be prepared to put the best case forward. We believe we have a very strong case. And we believe we make a strong case that trade should resume.

"So if it became necessary to follow that case with another appeal, you know we would take whatever steps are necessary. We feel very, very strongly that the border should be reopened. We feel very strongly that beef trade in the world should return to normal within the international guidelines and we're prepared to do that."

ANNOUNCER: "Our next question comes from Philip Brasher, and standing by should be Daniel Goldstein. Philip, go ahead, please."

REPORTER: "Yes, Mr. Secretary, one of my questions was just taken, but I want to follow up with, how do the procedures that you outlined in terms of inspections and so forth that will occur at the border certificates -- how does that compare with what took place prior to May 2003, the time the border was closed?

"And also how do you handle, what do you do with the animal ID that they have in Canada? Does that follow them across the border? Do you --"

SEC. JOHANNS: "Let me ask Dr. Clifford to jump in here and offer some thoughts on both questions. Doctor?"

DR. CLIFFORD: "Yes, Mr. Secretary. The procedures are basically the same procedures as we would follow normally with regards to inspection of animals. We just make sure that the new criteria are being met. As far as animal identification, these animals are required to have Canadian individual ID on them as well as animals for feeding purposes are also required to have a brand."

SEC. JOHANNS: "Okay. Next question, Daniel?"

REPORTER: "Yeah, hi, Mr. Secretary. I just want to confirm that one, no animals today are moving across the border. And then B, some of the equity analysts I've talked to have said they expect that the Tysons, Cargills and the Swifts of the world are going to bring in a large number of animals prior to the 27th just in case Judge Cebull indeed does lay down another injunction. Is that going to be healthy for the U.S. cattle markets to sort of see this kind of hoarding as it were just in case? Or is there something the USDA can do to prevent that from happening?"

SEC. JOHANNS: "On your last question, they have to meet our requirements. I mean, that is the bottom line. We don't try to run the industry, but we do have requirements that all people have to comply with or all processors, all purchasers of cattle. And so our focus will be on making sure that those requirements are met.

"Dr. Clifford, in terms of animals moving can you address that question? There aren't any animals moving I guess is my point, right?"

Dr. CLIFFORD: "There's no animals currently moving. We would not anticipate there would be a hoarding as such toward the courts, that this would be done in a step-wise manner that would make sense with that, and as we go through stages of implementation here --"

SEC. JOHANNS: "This is enough process where it's just going to take everybody some time here to get used to the requirements and the process and the steps that have to be taken. So I would offer that, but again the point is, everybody's got to comply with the requirements, and nothing can happen until those requirements are met.

"Next question?"

ANNOUNCER: "Our next question comes from Jeff Sparska (sp) from Washington Times, and he'll be followed by Orion Samuelson. Jeff, go ahead, please?"

REPORTER: "Hi, Mr. Secretary. Just going back to trade for a second, how do you see the WTO talks and the way they're unfolding and the commitments the U.S. is making affecting the next Farm Bill and prescribing what Congress will be able to do?"

SEC. JOHANNS: "There very definitely is a timing involved here, and if there is a successful WTO round that results in an agreement this December that could very well enter into the discussion and debate on the Farm Bill just simply because it does impact the question of subsidies, exports support, domestic subsidies, market access. All of those things are impacted, and of course that kind of gets to the essence of many parts of the Farm Bill.

"So it very well could have an impact. We have always made the case that we're ready, willing and able to engage in discussion on subsidies. But market access is the key for us. Our farmers are ready to compete with anybody in the world. But we have to have market access.

"We need to have access to the worldwide marketplace for that to occur. So it's very possible that the WTO process could impact the next Farm Bill. Too early to tell just simply because we don't have an agreement yet."

ANNOUNCER: "And our final question comes from Orion Samuelson of WGN. Go ahead, Orion."

REPORTER: "Mr. Secretary, back to Japan for a moment. You indicated you told your counterpart that Congress might lose its patience. Two part question. Is there support on Capitol Hill to take action against Japan if they don't move? And does the Japanese minister understand that we're serious?"

SEC. JOHANNS: "In reference to your first question, Orion, I believe there was support to take action the day I showed up for my confirmation hearing. I was prepared to talk about my qualifications to be Secretary, and as you know we spent almost the entire confirmation hearing talking about Japan. The level of frustration was very, very high at that point.

"What I explained to the Japanese minister was that I believe Congress has been patient in the hopes that this process was logically, thoughtfully moving forward on Japan's part. I also expressed to him that from my vantage point it appeared to me that there were very, very busy between now and the August recess, but after they return from the August recess attention may again turn to whether beef is moving into the Japan marketplace. If it is not, there's a point at which Congress does lose patience.

"And at that point I would be very, very worried that a course of action would be taken that none of us want. This is an excellent trading partner. I don't believe we're asking for anything unreasonable. It is time for them to return to trading with us in beef. We are going to do that with them. We are working on a rule relative to Kobi beef.

"So it very, very truly is time. Science is on our side on this issue. We are not asking them to do anything unusual. So I hope that they will work with us, they will finish this final step in the process, and we can get normal trade resumed.

"With that, everyone-- thank you very, very much. I will see you soon when I'm back in Washington. Take care, everyone."

ANNOUNCER: "Secretary of Agriculture Mike Johanns speaking to you from Madagascar.