The government's Covid-19 dairy hardship fund has been extended by one month for applications.
Producers are able to apply up to £10,000 to cover 70% of their losses across April and May incurred as a result of a drop in price.
It follows a reduced demand for milk with the closure of restaurants, bars, and cafes in recent months as a result of the coronavirus crisis.
Defra said in a new update: "We understand that this is a busy time for dairy farmers and as such the deadline for applications has been extended from 14 August to 11 September to provide you more time to apply."
Concerns have been raised over the poor uptake of the government's Dairy Support Scheme.
Since it launched in England on 18 June, approximately 174 applications had been received as of 27 July.
The Rural Payments Agency (RPA) reported that from the applications received, 17% were rejected for not meeting the eligibility criteria.
Approximately 86 percent of the applications have been assessed and payments have begun to be issued.
Fifty-five applicants have received support totalling around £481,000, with around 35 applicants receiving the maximum grant of £10,000.
Concerns have been raised over Defra’s decision to move from a drop in income to a milk price drop to calculate the fund's eligibility.
A statement from Defra and the Welsh government said: "Farmers will need to demonstrate they have suffered a reduction in the average price paid for their milk of 25% or more in April and May 2020 when compared with February 2020."
The Tenant Farmers Association (TFA) said the scheme had helped 'so few' dairy farmers given the extent of the issues faced by the sector.
"This has been caused by a tight eligibility criteria in comparison to other business support schemes promoted by government," the group said.