Farmers are now looking to the House of Lords to put pressure on the government to adopt proposals to safeguard British farming standards in trade deals.
An amendment put forward by MP Neil Parish for the Agriculture Bill legally required equivalence of standards for imported foods.
However, the clause was voted down by a majority of 51 on Wednesday (13 May).
The Bill is now likely to go to the House of Lords by the 1st week of June and then back to the Commons in early July.
The government has a manifesto commitment to protect and not compromise on environmental and animal welfare standard in trade deals.
But the National Sheep Association said it is 'highly concerning' that this pledge is not cemented into legislation.
"The pledge, after all, is one that stands for the term of this government, however, this commitment needs to be far more permanent that that," NSA chief executive Phil Stocker said.
"This amendment is at the top of the list that NSA, and no doubt a good number of peers within the House of Lords will be keen to examine in more detail as the Bill begins its journey in the Lords.
"We are firmly behind calls for a standards commission to take responsibility for standards equivalence decisions."
The amendment was defeated by 328 to 277 votes during the third reading of the Bill, having failed to receive the support of the UK government.
Peers in the House of Lords have now been urged by industry groups to work together to introduce changes in the legislation to protect UK food security and maintain standards.
The Farmers’ Union of Wales (FUW) said it believed the government had made a 'grave error' in opposing the amendment.
President Glyn Roberts said: “With the Bill now due to be considered by the House of Lords it is essential that they do all they can to correct this position before the Bill returns to the House of Commons.
"I truly hope that the government will support rather than obstruct this."
It comes as media reports suggest that the UK government is preparing to offer a 'big concession package' to the US which includes a plan to cuts tariffs on agri imports.
International trade secretary Liz Truss is offering incentives to help finalise a trade deal with the United States, according to the Financial Times.