KOBE -- It's a warm, sunny day at the Okaba cattle ranch in Kobe's Kita Ward.

Black Angus cattle keep to their pens in Kobe.

Nearly 500 Black Angus cattle are housed here for up to three years before being loaded onto a truck and taken to a local slaughterhouse, where they end up as famed Kobe beef.

At one end of the ranch, young calves, still thin, jump around excitedly, while on the other end, close to the loading ramp, huge adults lie sleeping.

But as Teruhiro Tachibana, head of the Hyogo Prefectural chapter of the National Federation of Trade Unions of Agricultural Corporate Associations, ruefully noted, the oldest and fattest cattle -- scheduled to head to the slaughterhouse next month -- may get a reprieve.

"Demand for Kobe beef has dropped by nearly 50 percent since it was disclosed that mad cow disease had been detected in Chiba Prefecture. Kobe beef dealers can't sell what they have in stock now, so we may wait a while before more cattle are slaughtered," he said.

Famous nationwide for its marbled texture and tenderness, as well as its astronomically high price tag, Kobe beef, along with Matsuzaka beef and Yonezawa beef, is considered a delicacy by Kansai region diners. Many, especially in Kobe, will insist it's the best of the three.

At the Okaba ranch, one of several in Hyogo Prefecture, the cattle live out their lives in small pens that hold between eight and 10 cows each. The first thing any visitor familiar with farm life will notice is the almost complete absence of flies.

Although the cows are crammed into an area not much bigger than a football field, there is almost no smell, and extraordinary care is placed on sanitary conditions.

"Kobe beef cattle are pedigreed, and we keep records of a calf's parents, grandparents and great-grandparents. About half of the 500 cattle currently kept here were born and raised in Hyogo Prefecture, while the remainder were brought here to be raised," Tachibana said.

Masaki Nakahigashi, who runs the ranch, explains how the cattle are raised.

"The cattle are fed three times a day. The calves receive straw and some oats, while adults eat a mixture of corn, bran, oats and barley. Contrary to popular belief, though, the cattle are not fed mash leftovers from making beer," he said.

Both Tachibana and Nakahigashi said that absolutely no animal byproducts are mixed into the feed.

"Mad cow disease occurs when cattle are fed animal byproducts like sheep's brains. All Kobe beef cattle are on a strict vegetarian diet," Nakahigashi said.

When calves are purchased from ranches outside Hyogo Prefecture, he explained, the owners must provide proof that they have not been fed animal byproducts, a practice that began only at the beginning of this month, on government orders after the first cow with bovine spongiform encephalopathy was confirmed.

While Nakahigashi said it was extremely unlikely that any of the ranches were secretly feeding their calves animal byproducts before that, he also admits there is not a lot of formal checking done.

"It's a question of trust. We've been dealing with these ranches for a long time, and they must provide a lot of information about the calves, including their pedigree. But no formal veterinary checks are made of the cattle before they arrive here in Kobe," he said.

Local veterinarians and animal husbandry experts are called when any of the cows appears sick. Separate pens are set aside for those animals that show signs of illness, and the decision on whether to call in experts is left to Nakahigashi's discretion.

Tachibana empathized that, unlike ordinary beef, Kobe beef distributors are licensed and must display a certificate that the beef they are selling is genuine. They must meet strict hygiene standards before they can become approved dealers.

"The entire method of preparing Kobe beef, from the strict, controlled environment to the vegetarian diet to the emphasis on sanitary conditions, means that the meat is extremely safe, certainly much safer than ordinary beef," Tachibana said.

Yet customers remain wary. At Osaka's Hanshin Department Store, sales of beef, including Kobe beef, have dropped to almost zero, clerks said.

To further exacerbate the situation, while Tachibana is trying to get the message out that Kobe beef is safe for consumption, some customers are holding off for economic, not safety reasons.

"Kobe beef costs about 1,000 yen per 100 grams on average at the moment, but that price is sure to drop over the next few weeks as suppliers try to reduce their stocks. Customers know this, and those who want to eat Kobe beef are waiting for the price to fall," Tachibana said.