Defra Minister Lord Rooker, one of Secretary of State Hilary Benn's senior deputies, said the Government supported the pig farmers' campaign for more money.

He told the House of Lords: "If the supermarkets want to see the end of British pork production, they are going exactly the right way about it. We fully support the claims of the industry that they should get a fairer share of the price ... but we ourselves can't interfere with that."

He was responding to Lord Livsey of Talgarth (Lib Dem), who asked: "Isn't it time a ban was put in place on supermarkets selling a product at less than the price of production?"

Lord Rooker said: "That is very unsatisfactory. But at the end of the day, the market will decide. The Competition Commission is looking at these issues."

The Competition Commission is a Department of Trade and Industry body which recently produced a report – which the farmers found disappointing – on how supermarkets used their power.

The commission did promise to investigate further but is not expected to come up with anything soon and the farmers are already running down their herds and making themselves and staff redundant.

Richard Lister of Boroughbridge, North Yorkshire, chairman of the producers' group of the National Pig Association, was among the hundreds who travelled to Westminster four weeks ago, to point out that big buyers were not covering the cost of feeding a pig.

Since then, prices have improved slightly. But Mr Lister said: "We need something much faster than another Competition Commission report.

"In the end, governments cannot set prices. But I think these words from Jeff Rooker are the strongest statement yet that the government expects retailers to make some move."

The hope in the pig industry is that one of the big supermarkets will lead a move to pay UK producers significantly more than the going rate on world markets, to ensure future supplies.

Lord Rooker also agreed, in the course of yesterday's debate, that it was "unsatisfactory" that food could be labelled British if it was only processed in Britain.