In a huge blow for the $27 billion (15.3 billion) US cattle industry, Japan and South Korea, the top two buyers of US beef, swiftly halted imports along with Singapore, Malaysia, Hong Kong, Taiwan, Russia, Ukraine and South Africa.

US Agriculture Secretary Ann Veneman urged Americans not to panic, saying the risk to their health was extremely low.

"I plan to serve beef for my Christmas dinner," she said.

Europe, whose herds were devastated by the brain-wasting disorder in the 1990s, said it was keeping a close eye on the case, but it was not considering tightening protective measures already in place for years.

The 15-nation European Union has long banned the import of most US beef because of health concerns over cattle treated with growth hormones, allowing in a limited quantity of the meat from the United States.

Britain offered the United States its expertise in battling the disease which forced British farmers to destroy about 3.7 million cattle in the 1990s to try to rid the food chain of material infected with BSE.

BSE refers to bovine spongiform encephalopathy and scientists believe people can contract a form of Creutzfeldt-Jakob Disease known as vCJD from eating beef products infected by BSE, such as diseased brain or spinal column material.

At least 137 people have died of vCJD, mostly in Britain, all linked to eating beef or having received blood or tissue transplants from vCJD patients.

Alarm over the disease pressured share prices of fast-food companies on Wednesday, fanned fears humans could become infected, and raised the spectre of mass cattle culls similar to those carried out in Europe.

McDonald's, the world's largest fast-food company, said in a state ment its supply chain "has no connection whatsoever" to the farm in Washington state where a sample of a diseased cow tested positive on December 9.

But that didn't stop shares in McDonald's Holdings (Japan), Japan's biggest restaurant chain, taking a big hit and dipping more than three percent.

Industry analysts said there could more pain to come for McDonald's and other fast-food outlets if consumers decided to cut back on eating beef. McDonald's has been hurt before by a consumer backlash in both Europe and Japan after they reported mad cow cases.

"It is a big deal," said Joe Kropf, livestock analyst with Kropf and Love Consulting. "Consumers cut back on consumption and countries, for safety reasons, embargo beef from affected countries."

US beef exports totalled $3.2 billion last year and the US cattle industry has long feared an outbreak of the disease. An outbreak in neighbouring Canada in May this year has cost that country billions of dollars.

"I couldn't see this having a major impact on the US economy as a whole," said Paul Mackel, currency strategist at Dutch bank ABN Amro in London.

The Paris-based International Animal Health Organisation (OIE) said the discovery of mad cow in the United States was not a surprise as the country had received several warnings the disease might be heading their way.

"There were signs this might be coming," said Jean-Luc Angot, department chief at the OIE.

Agriculture Secretary Veneman said a tissue sample from the infected dairy cow had been flown by a US military jet to an animal laboratory in England for additional confirmation. Those results would not be ready for three to five days.

The farm where the cow was found was quarantined and officials were checking with other processing plants where parts of the animal were sent.