A MEAT marketing company set up by farmers to secure a brighter future in the wake of the 2001 foot-and-mouth crisis has ceased trading.

News that the Dales Quality Meat Company, based in Hawes, North Yorkshire, has crashed is a blow that could have serious repercussions for the upper dales, where a quarter of the population relies on agriculture and related industries.

Administrators were appointed to the company last month.

A spokesman for administrator Kroll said last night the company had ceased trading prior to the firm's appointment because of "significant cash-flow difficulties".

He held out little hope of a rescue and admitted there would be precious little for creditors.

Dales Quality Meat was set up in 2003 with funding from the Department for Environment, Food and Rural Affairs.

It was part of a three-way alliance with Hawes Auction Mart and the McIntyre Meats abattoir, in Bainbridge.

The company's aim was to source locally-produced beef, lamb and pork from farms in Wensleydale and the surrounding area.

But it made six-figure losses in the first two years, compounded by heavy operating losses this year.

Councillors and farmers hope the crash will not have an adverse effect on Hawes Auction Mart.

"The presence of the action mart keeps our two banks going and keeps a lot of agricultural suppliers in business, said John Blackie, a parish, district and county councillor for Hawes.

"The parish council, and I as a district councillor, would be very concerned if there was any threat to its future."