Brussels is threatening trade sanctions to punish Britain for flouting the Brexit protocol that states Northern Ireland is treated like part of the EU when it comes to farming and products like chilled meats.
Mr Eustice mocked the stance as “idiosyncratic” and told LBC: “I suspect it links to some kind of perception that they can’t really trust any country other than an EU country to make sausages.
“I think that’s a nonsense. I think we’ve got a very good sausage industry in this country, we’ve got the highest standards of food hygiene in the world.”
But former French European minister and MEP Nathalie Loiseau was not laughing. She told the Today programme: “We are warning (that) you signed an agreement, you have to implement it. Otherwise, there are measures that we can take legally that will protect our single market.”
Writing in the Daily Telegraph, the European Commission vice president Maros Sefcovic said the EU would “not be shy” in taking action.
Both sides will appeal to US President Joe Biden for support during meetings in the margins of the G7 summit this weekend.
Mr Biden is reportedly planning to use the G7 summit to impress upon Boris Johnson the importance of maintaining the Protocol.
But Mr Johnson may counter that the peace process and the Good Friday Agreement will be damaged if the protocol is enforced in an unnecessarily harsh manner that upsets the Unionist community.
Under the legally binding Withdrawal Agreement, Northern Ireland remains within the EU agriculture and trade bloc. Brussels argues that it must act to stop goods entering the single market via Northern Ireland.
But Mr Eustice said there was nothing to suggest British sausages were being exported to the rest of the EU.
Britain has already angered Brussels by unilaterally extending grace periods in the Protocol on supermarket goods and parcels.