Nocton Dairies has withdrawn its planning application for a 3770-cow dairy unit in Lincolnshire.
The move marks an end to efforts to establish Britain's first super dairy.
A statement from the company said: "We have written to North Kesteven District Council to formally withdraw our application for planning permission to build a 3770 cow dairy farm at Nocton Heath, Lincolnshire.
"The sole reason for this decision is the response of the Environment Agency, which has maintained its objection to the proposal.
"The Environment Agency’s grounds are lack of information about risks posed to the aquifer underlying the site and uncertainty about the extent of the benefits associated with the change in land use.
"This precautionary stance and requests for new information reflect unfamiliarity with agriculture in general and the design of the modern dairy farm in particular.
"Despite our best efforts to address these concerns, including an additional investment of £4m in engineering the management of the waste to unprecedented standards, lack of relevant research has made it impossible to provide the reassurances required by the Environment Agency that livestock farming is an appropriate use of land at this site," the statement read.
A spokeswoman added that the company would like to emphasise the following points:
· The challenge has been laid down to the farming industry to produce more with less. We need leadership to help us do this and proactive advice from regulatory experts – only a practical, informed and ‘can-do’ approach will move this whole agenda forward
· The industry needs to stand up to those who would twist the facts about animal welfare, and highlight lack of investment as the issue, not scale or type of system. If our industry does not tell the public the facts and open its doors to show how we are great at farming in many different ways, then misinformed single interest pressure groups will fill the void with untruths to the eventual detriment of all
· The fundamental concept we have been proposing is a sound one: expand dairying toward the east to re-integrate livestock and arable farming, make better use of resources, proactively manage welfare, gain economies of scale, and look to support a long term reduction in water pollution. We challenge other farmers to pick up the baton and see where these concepts can take them.
"Our other two applications for a pipeline and reservoir remain active. Our farm at Nocton is a tremendous site with much potential for the future, so we won’t be selling it, but will now be taking some time to consider our options," the spokeswoman added.