Individual animal identification is an important consideration for many countries to improve animal traceback systems. The analysis presented by the authors provides a conceptual benefit-cost framework for evaluating the economic usefulness of improved animal identification systems designed to reduce the consequences of foreign animal diseases (FAD). For cattle in situations similar to those found in the United States of America, results show that improved levels of animal identification may provide sufficient economic benefits, in terms of the reduced consequences of FAD, to justify the improvements. In contrast, the results of similar studies in swine show that the economic benefits of the reduced FAD consequences are not sufficient to justify improvements in animal identification systems. Vertically integrated industries, in which animals have only one owner in a closed system from birth to slaughter, may not require individual animal identification for traceback purposes. However, additional benefits, not quantified in this analysis, could contribute to favourable benefit-cost ratios for improved identification in certain sectors of the swine industry.