The US government said on Tuesday it was moving immediately to tighten oversight of the $27 billion cattle industry and boost consumer confidence after the first case of mad cow disease in the United States.

The moves -- some now endorsed by a once-reluctant industry that is still reeling from the sudden loss of a $3 billion a year beef export market came after a fourth straight day of sharply lower cattle prices in US markets.

The USDA is investigating the cause of the first US case of mad cow disease, also known as bovine

spongiform encephalopathy (BSE). The USDA announced on Dec. 23 that the disease was found in a Holstein dairy cow in Washington state.

Agriculture Secretary Ann Veneman told a press conference that the US government is immediately banning downer cattle -animals unable to walk on their own at the slaughter plant -- from being used as food for humans.

"The actions we are taking are steps to enact additional safeguards to protect the public health," she said.

As a precaution, Veneman said, processors would be barred from

using the brains, eyes and small intestine of older cattle in human food. Another new regulation seeks to keep spinal tissue out of meat products via meat recovery systems" that scrape tiny bits of meat off a carcass.

The USDA will work to create an identification system for tracing animals and create an international panel of scientists to review the department response to the mad cow case.

"This is a rational response to a situation that has now reached a new plane," said Bob Price, president of North America Risk Management Services, a livestock consultancy in Chicago.