Cattle Prices Plunge After Test Indicates Possible Mad Cow Case

Cattle futures in Chicago had their biggest decline in six months after the U.S. said a mad-cow screening test was positive and may indicate the second case of the disease since December. The test has yet to be confirmed.

The Department of Agriculture said Friday an animal tested positive for bovine spongiform encephalopathy, or BSE, under an expanded screening program begun June 1. The carcass was sent to the department's National Veterinary Laboratory in Ames, Iowa, for additional tests. Beef prices that plunged in December had recovered most of their losses during the past six months.

``The USDA has been warning us to expect as many as 30 or 40 false positives or inconclusives since May when they announced the expansion of testing for the disease,'' said Dave Weaber, director of research at the member-owned information agency Cattle-Fax in Denver. ``It all depends now on whether the additional tests are positive or negative, and we are trying to keep our people in a holding pattern.''

Cattle for August delivery fell 2.925 cents, or 3.3 percent, to 86.425 cents a pound on the Chicago Mercantile Exchange, after earlier dropping the exchange's 3-cent limit to 86.35 cents. It was the biggest one-day percentage decline since Dec. 31. Prices are up 25 percent from a year ago....