Claims by a German government spokesman that mad cow disease could cross over into sheep were dismissed as nonsense by EU experts, the British government, farmers and scientists.
However, farmers said last night that they feared damage may already have been done to British exports.
The controversy was sparked by Werner Zwingmann, a German agriculture ministry official, who warned consumers off British lamb during an interview on German television. He said: "Until this is cleared up by the European Union's scientific panels, [consumers] should give preference to sheep meat from other countries.
"I do not want to say that there is a concrete danger for consumers. There are too many holes in what we know, and these must be filled quickly."
Mr Zwingmann's comments appeared to have been based on reports of laboratory experiments in which sheep contracted BSE after being exposed to huge doses of the infective agent. But this did not take into account the fact that not a single sheep has displayed BSE-type symptoms outside a laboratory.
Last night, Nikolaus van der Pas, the European Commission's chief spokesman, poured scorn on the German advice. "We don't support any such recommendation because we don't see any grounds for it," he said.
The Meat and Livestock Commission described Mr Zwingmann's statements as "alarmist and unscientific".
Its spokesman, Phil Saunders, said: "There has not been one case in Europe of a sheep contracting mad cow disease. It is almost incredible that the ministry could be so irresponsible as to start a new consumer panic in their own country against all science, logic and reason."
Welsh farmers, who could be hit particularly hard by a German ban, said they were considering calling for a boycott of German tractors and farm machinery under a slogan: "If it's Jerry built, don't buy it." Last year, Welsh farmers exported pounds 113m worth of lamb to Germany; Britain, as a whole, exported 47,600 sheep and 4,275 tons of mutton.
A spokesman, Gwillym Thomas, said: "They export about pounds 200m a year in farm equipment and tractors to us each year, but if they are going to boycott our products on such spurious grounds, then we'll boycott theirs.
"There is a lot of anger here that someone can make such irresponsible claims without thinking of the terrible economic damage they can cause."
While Conservative MPs joined in condemnation of the Germans, they received support from an unlikely source. Richard Lacey, professor of medical microbiology at Leeds University, a thorn in the side of the Government over food crises from salmonella in eggs to BSE and its links with CJD, described the German claims as ridiculous.
"They are claiming there is a link between BSE in cattle and scrapie in sheep, but they are two separate diseases," he said.
"The incidence of BSE in cattle increased exponentially from seven in 1986 to 36,000 in 1993, but during the same period sheep scrapie stood at about 300-400 a year and it's falling."
However, he added: "There is still blame to be laid at the feet of the Government because for years they lied to the world about the cause of BSE, saying it had been caused by scrapie-infected feed.
"Now that there are suspicions that BSE is causing a new type of Creutzfeldt- Jakob disease in humans, they can't really complain that the rest of the world is concerned about eating our sheep."Reuse content