WASHINGTON (AP) _ A National Institutes of Health panel has concluded that a controversial, genetically engineered hormone that stimulates milk production in cows has no effect on dairy or meat products and poses no health hazard for humans.

In a news conference Friday that was repeatedly interrupted by shouting protestors, Dr. Melvin M. Grumbach of San Francisco said a panel of 13 experts selected by NIH had concluded that milk and meat from cows stimulated by the manufactured hormone ''are as safe as those from untreated cows.''

The committee did conclude, however, that more research was needed to determine the effects of the hormone on a specific dairy cow disorder, and to examine effects of a minute elevation of a growth factor in the stimulated milk.

''This is absurd,'' shouted one protestor. ''How can you say it is safe and then that you need more studies?''

Grumbach, a pediatrics professor at the University of California and chairman of the panel, said that the committee could find no persuasive evidence against the use of the hormone, called recombinant bovine somatotropin, or BST.

''The evidence clearly indicates that the overall composition and nutritional quality of milk and meat from BST-treated cows is equal to that from untreated cows,'' Grumbach said.

Following the announcement, a question-and-answer session for reporters was repeatedly interrupted by two longtime opponents of BST, Jeremy Rifkin of the Foundation on Ecomonic Trends, and Samuel Epstein of the University of Illinois.

Recombinant BST is a manufactured version of a naturally occuring hormone in cows. Scientists have known for decades that shots of the natural hormone causes cows to increase milk production by up to 15 percent, and when young calves to grow faster. There has been only rare use of the natural hormone in the dairy industry, however, because of its high cost.

In recent years, several drug companies have used genetic engineering to produce a form of BST and have determined that the hormone can be made cheaply enough to be of practical use. The companies have asked the Food and Drug Administration to approve the manufactured hormone for use in dairy herds.

Opponents have claimed that meat and milk from cattle injected with the manufactured BST will have higher levels of the insulin-like growth factor IGF1, and that it will lead to wider use of antibiotics in dairy cattle. Rifkin and Epstein also claimed that BST will cause cattle to have increased incidents of mastitis, an inflammation of the udder, and have reproduction problems.

The NIH committee, which included two veterinarians and a dairy farmer from Maryland, said that research shows the levels of IGF1 in milk from BST-treated cows would double, but that even with the increase the amounts are too minute to have an effect on most humans.

Dr. Raymond L. Hintz, a pediatrician from Stanford University, said that adult human salvia normally contains IGF1 at a much higher concentration than is found in BST-treated milk. He noted that IGF1 is a protein that is normally metabolized by the intestines in humans and does not enter the bloodstream.

Hintz said there was some slight concern by the panel that the increased IGF1 could have some effect on newborn humans. The committee called for research to examine the IGF1 effects on the upper gastrointestinal tract, particularly the esophagus, in newborns.

The Stanford professor noted that very young babies are very seldom fed whole milk, anyway, and that treated cow's milk has only slightly more IGF1 than normal human breast milk.

The committee also recommended research to evaluate the effects of BST on increased cases of mastitis in dairy herds, but said that the hormone ''does not appear to affect appreciably the general health of dairy cows.

Grumbach admitted that the FDA did not provide information from an on-going study of BST being used on some 20,000 diary cows. He said when the FDA completes its study, the ''committee's conclusion regarding animal health may have to be modified.''

The committee chairman also admitted that most of the data studied by the panel came from companies that manufacture BST or from investigators whose work is financed by industry.

Approval of the use of BST is now being considered by the FDA and Grumbach said much of the data that the agency is studying could not legally be shown to the NIH panel.

The NIH committee was organized at the request of Congress to provide an independent evaluation of BST before it is approved for use in the dairy and cattle industry.

From the study, said Grumbach, ''there was no data of a compelling nature to withhold approval of this material.

''We don't feel that there was evidence to believe that either milk or meat would not be safe products,'' he said.

BST is now banned from use in two states and in some European countries.