LAMB tagging changes could cost producers £1.8 million, according to representatives of the sheep industry.
Defra's decision to outlaw non-electronic batch tags for slaughter lambs was disappointing and could be very expensive, said the National Farmers' Union (NFU).
It was responding to the results of a Government consultation in early autumn to pave the way for the introduction of electronic reporting of sheep movements.
Defra has proposed that from 2015 lambs less than 12 months old will have to be electronically tagged, which will add a significant cost to farm businesses.
NFU livestock board chairman Charles Sercombe said: "This announcement comes at a time when livestock businesses have seen incomes drop by nearly 50 per cent over the past year.
"We've been clear with Defra that the last thing livestock producers now need is to see a rise in tagging costs.
"Unfortunately the calls from the NFU and other farming organisations appear to have fallen on deaf ears and I have invited the minister to visit my farm to discuss the issue in more depth.
"It's [a] positive [sign] that Defra has listened to some of our concerns and delayed this implementation to 2015 to allow farmers to use some of the existing stocks of tags, but there's no getting away from the fact that the vast majority of our sheep-farmers will just view this as a further burden on the industry."
The National Sheep Association (NSA) said it was "bitterly disappointed" that Defra had stuck to its decision to implement full electronic ID (EID) in England, even in lambs going directly to slaughter that posed no traceability or disease risk.
Chief executive Phil Stocker said: "Given the wording of the consultation and comments made by Environment Secretary Owen Paterson and Defra officeholders during the consultation period, it appears that Defra had already made its mind up and was wasting our time and resources by asking us to present our views.
"It was clearly a done deal and a decision that was made without any risk assessment of what the industry can afford and implement.
"The NSA felt very strongly that even if Defra wanted to remove the option of the non-EID slaughter tag there was no justification for applying this right across the board and including lambs, when their first and only move is straight to an abattoir, with no other collections, mixing or unloading in between.
"The disease risk is so low for these moves that EID tagging cannot be justified and is simply adding bureaucracy and costs with zero benefit. Our consultation response made it very clear that if the sector was to take an additional burden with these rule changes, Defra must respond by providing benefits."