Language in the Senate version of the recently approved FY2006 Agriculture Appropriations Bill noted that Digital Angel RFID technology has already proven its value to the federal government during the Company's 15-year relationship with the U.S. Department of Energy and its work in the salmon fishing industry. Digital Angel provides the government with electronic tags and scanners to track salmon in fisheries throughout the Northwest.

Since the December 2003 incident of Mad Cow Disease (Bovine Spongiform Encephalopathy) in the state of Washington, the USDA has initiated the development of a national animal identification program for cattle, with a target completion date of 2008-2009.

Digital Angel's RFID traceability system includes electronic tags and scanners as well as a database system that can provide for the registration, tracking and source verification for the animals tagged in the national identification program. The Company expects to sell more than 3 million electronic RFID tags in the U.S. this year.