Manufacturers of such meat products as bologna and sausage will be able to include powdered bone in their products without saying so on the label under Agriculture Department regulation changes approved yesterday.

Under the old labeling rule, if a meat product included powdered bone, the label had to state the percentage of powdered bone in letters one-fourth the size of the product name. The new rule eliminates that requirement. Instead, the product will have a disclosure showing the amount of calcium per serving, either in the nutrition statement or somewhere else on the label.

Consumer groups immediately criticized the new rule, which is scheduled to take effect in 30 days.

"It is outrageous that they would do that," said Tom Smith, research director for the Community Nutrition Institute, a nonprofit consumer activist group. He said his group will file suit to bar the rule as a violation of the Meat Inspection Act "because it is misbranding and mislabeling."

But the USDA action was hailed by meat industry officials, who had fought vigorously for the rule change on the grounds that it would lead to greater efficiency and new savings for producers and consumers. "It is an encouraging step in the right direction," said Rosemary Mucklow, executive vice president of Western States Meat Association, a trade group.

The controversy over the labeling of meat products with powdered bone is tied to the manufacturing process in which meat is deboned mechanically rather than by hand. Most meat is trimmed from bones by hand. But under the mechanical process, bones and adhering meat are fed into a machine that breaks the bones and feeds the resulting mixture through a sieve that allows meat and powdered bone to pass through.

Although meat packers and processors have invested approximately $30 million in equipment that can mechanically process meat, there has been only limited production of meat products containing powdered bone--less than 1 percent of the potential supply, according to the background notes published in yesterday's Federal Register.

One reason why more meat products containing powdered bone haven't been manufactured has been the labeling requirement, according to Donald Houston, the administrator of the Agriculture Department's Food Safety and Inspection Service.

"Market studies show that the [bone] labeling would leave a connotation," Houston said. Believing that consumers wouldn't buy products labeled as containing powdered bone, industry chose not to manufacture them, he said. The new labeling regulation will encourage the production of mechanically deboned meat, while still assuring consumers that they are getting "wholesome, unadulterated meat products that are properly labeled," he said.

Food products that can contain powdered bone--or calcium, as it will now be called--include a variety of items, such as frankfurters, luncheon meats and beef patties. But the powdered bone won't be allowed in baby foods and can't be used if it would alter the basic characteristics of such meat products as ground beef or corned beef cuts. The amount of bone and fat permitted in meat products also would be limited by the new rule.

Although some consumer advocates have raised health and safety questions about meat products with powdered bone, Houston said a panel of government scientists concluded that bone particles of the size obtained with mechanical deboners currently available "presents no hazards to health."

Houston said that the mechanical processing of meat products containing powdered bone represents a benefit of $495 million a year for producers, who could get an additional 8 to 10 pounds of beef per animal and 5 to 7 pounds of pork per animal. Consumers would benefit, Houston said, depending on how much of the savings the producers decide to keep and how much they decide to pass along.