The Farming Recovery Fund, set up to provide farmers with funds following flooding, will be further delayed.
A decision on the funding is now not expected until the Chancellor delivers the Autumn Budget, which is due to take place on October 30.
This is despite reassurances from a senior Defra official last week that a decision was imminent.
The Tenant Farmers Association (TFA), which had learnt about the delay, said the funds needed to be brought forward 'as a matter of urgency'.
It comes as the UK saw its wettest 18 months since records began, leaving thousands of acres of productive farmland under water.
The funding was first announced in January and industry bodies have worked with Defra to help develop the offer, which has included feeding in examples of the challenges faced by farmers.
But the TFA said the latest update would be a 'blow to farmers’ confidence', which is already at an all time low.
TFA farm policy adviser, Lynette Steel, added: “We want to assure members that we will continue to press Defra to bring forward the fund as a matter of urgency”.
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