The rather modest market response to this news is because it wasn't really new. We've known since 2003 that the U.S. is no longer free from BSE. We know that on occasion a cow will test positive. We know that the USDA inspection system is keeping meat from infected cows out of the food system. We know that the human form of BSE is incredibly rare and no one has ever gotten it from eating in the U.S. Tuesday's announcement changed none of that.

Despite the BSE announcement, the beef cutout value was higher this week. On Friday morning, the choice boxed beef carcass cutout value was $190.65/cwt, up $2.55 from the previous Friday. The select carcass cutout was up $2.86 from the previous week to $187.24 per hundred pounds of carcass weight.

Fed cattle prices were lower this week. Through Thursday, the 5-area average price for slaughter steers sold on a live weight basis was $119.76/cwt, down $2.89 from last week, but up $2.98/cwt from the same week last year. Steer prices on a dressed basis averaged $193.69/cwt this week, down $4.83 from a week ago, but up $6.76 from a year ago. Packer margins are improving. Last week, steer dressed prices were $10.42/cwt above the choice cutout value. This week the price spread is only $3.04/cwt.

This week's cattle slaughter totaled 611,000 head, up 2.2% from the week before, but down 1.6% from a year ago. The average dressed weight for slaughter steers for the week ending on April 14 was 837 pounds, down 6 pounds from the week before, up 19 pounds from a year ago, and above a year earlier for the 14th consecutive week.

Oklahoma City feeder cattle prices were mostly steady to $2 higher this week with the ranges for medium and large frame #1 steers: 400-450# $200-$205, 450-500# $195-$208, 500-550# $191.503-$195, 550-600# $179-$188, 600-650# $170-$178, 650-700# $159-$170, 700-750# $153-$161.75, 750-800# $146-$153, 800-900# $134.75-$149, and 900-1000# $128.50-$133/cwt.

The amount of beef in cold storage at the end of March, 507.9 million pounds, was up 7.9% from the month before and up 14% from a year ago.

Live cattle futures contracts were lower for the week. The April contract ended the week at $118.45/cwt, down $2.10 from last Friday. The June contract settled at $112.85/cwt, down $2.60 for the week. The August fed cattle contract ended the week at $115.55/cwt, down $3.30 compared to the week before. October settled at $120.72/cwt. May corn futures gained 41 cents this week to end at $6.53 per bushel. August feeder cattle closed the week $3.27 lower at $152.05/cwt.