The decision to cut the rate paid this year from the Areas of Natural Constraint (ANC) scheme and to eventually close it entirely is a "major blow" to upland farmers.
The arrival of ANC payments into bank accounts over the coming weeks has been welcomed by the Northern Irish farming industry.
The Ulster Farmers’ Union (UFU) says the arrival of the payments will be welcomed by farmers after the long, wet winter.
However, the union said there is still "significant concern" that the Department of Agriculture, Environment and Rural Affairs (DAERA) has persisted with plans to end the scheme this year.
UFU hill farming chairman, John Kennedy said ANC payments are important for disadvantaged areas.
“Spring is a costly time of the year on all farms. It's even more expensive on farms in severely disadvantaged areas where cold weather and wet conditions restrict grass growth and stock turnout,” Mr Kennedy said.
“This drives up costs annually and that is why ANC payments are so important for cash flows.”
'Major blow'
However, he said the decision to cut the rate paid this year and to close the scheme entirely is a "major blow" to farmers in hill areas.
“The UFU has consistently asked that DAERA review their position and extend this scheme post 2018. However, DAERA officials believe the modest increase in Basic Payment to severely disadvantaged areas will offset the loss of ANC payments.
“In reality, this could not be further from the truth,” said the UFU hill farming chairman.
“Many severely disadvantaged area (SDA) farms are losing money from the Basic Payment transition process while others will be affected by a loss of income due to the fact the Environmental Farming Scheme has been made too bureaucratic and financially unattractive.”
Lack of government
The union said that re-opening the debate about extending the ANC scheme is not possible without an Executive at Stormont.
The Northern Ireland Executive collapsed after deputy First Minister Martin McGuinness resigned in protest over the Renewable Heat Incentive scandal.
Mr Kennedy said if the government gets back up and running, reopening the ANC scheme before the end of the current Rural Development Programme "must be considered".
Looking ahead to farm support policy post Brexit, the UFU said there needs to be "new and more effective" forms of hill support available.
Mr Kennedy added: “Farms in hill areas make a major contribution to our economy through food production and supporting tourism, while also delivering real benefits for the environment and the preservation of rural heritage.
“This has been recognised for decades by the EU and we would expect the UK government to strongly acknowledge this as part of a future UK agriculture policy.”
