Japanese Restaurants Hurt By Mad Cow Ban

A major Japanese fast-food retailer has said it would stop serving its trademark beef dish unless authorities lift a ban on U.S. imports, underscoring the dilemma facing restaurant chains following the United States' first case of mad cow disease (search).

The announcement late Tuesday by the Yoshinoya (search) chain that it may remove from its menu a popular beef-and-onions rice dish was the latest attempt at damage control in the American beef-dependent restaurant industry. Japan (search) is the world's biggest customer for U.S. beef.

News that a cow in Washington state tested positive last week for the brain-wasting bovine disease unnerved Japanese consumers, who have only recently regained their appetite for beef after a mad cow scare at home.

For low-cost eateries like Yoshinoya, there's no substitute for cheap U.S. beef.

Yoshinoya, which has 980 restaurants nationwide, relies on U.S. suppliers for 99 percent of the beef used in its trademark "gyudon" beef bowl -- which at $2.50 is a staple for office workers and budget-conscious students.

Yoshinoya's president Shuji Abe said the chain would run out of beef stocks in February. If the ban on U.S. beef imports persisted, Yoshinoya wouldn't be able to continue its signature product.

"I never thought our business would come to this," Abe said.

Japanese beef is typically pricier than imports, and often reserved for delicacies like sukiyaki -- thin strips of marbled meat boiled with vegetables. At one Tokyo meat shop Tuesday, 2.2 pounds of homegrown sukiyaki-quality beef was selling for about $28 -- about twice the price of comparable imported meat.

Japan imports about two-thirds of its beef, of which around 47 percent, or 226,524 tons, came from the United States last year. The rest comes mostly from Australia and New Zealand. Neither country has had a reported case of mad cow disease.

It is unclear when Japan will reconsider the ban on U.S. beef.

Japanese officials told a visiting U.S. delegation on Monday that they wouldn't discuss a resumption until the facts of the case are clear. The infected cow has tentatively been traced to Canada. Tokyo also bans beef from the European Union nations and Canada.

The Japanese government is reportedly holding out for tougher U.S. safeguards. When Japan discovered its first mad cow case two years ago, authorities started testing every cow intended for human consumption -- something U.S. officials have called unnecessary.

The ban could cost U.S. beef producers. The United States sold $1.03 billion worth of beef, veal, prepared beef products and variety meats to Japan in 2002, accounting for about 32 percent of total exports.

So far, Japanese consumers have received mixed messages from retailers and restaurants about the U.S. case.

Supermarkets are split over whether to pull U.S. beef from their shelves. Some restaurants have put up signs saying their beef wasn't from the United States. McDonald's Japan has taken out full-page newspaper advertisements saying its patties were made only with Australian beef. Others have insisted their beef was safe because it came from U.S. states other than Washington.

Nakau Co., which serves gyudon at its 263 outlets, and Mos Burger, a hamburger chain, said the cuts of U.S. beef they use are safe from infection.

Ground beef from labeled cuts like chuck or round, as well as beef steaks, roast, liver and tongue, are considered safe, experts say.

The Japanese government recently announced plans to send a team of officials to Australia to assess how much more beef that country can supply.

A few restaurants have been looking into alternative suppliers.

Takahisa Jojima, a spokesman for Royal Co., which runs 341 Royal Host restaurants in Japan, said 80 percent of its beef comes from Australia, and the rest from the United States.

"We have begun considering whether its possible to import more from Australia in case the ban on U.S. imports continues," said Jojima.