Agriculture Minister Bridget McKenzie should step down, according to a south-west dairy industry advocate.
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Garry Kerr, who is the chief executive officer of Farmer Power, said his personal opinion was that Ms McKenzie had let down dairy farmers.
"It's an absolute farce," Mr Kerr said.
His call for her resignation comes after it was reported Ms McKenzie admitted a mandatory dairy code of conduct would not be in place by the start of next year.
She also refused to say who rewrote the draft code to change the rules around retrospectively slashing prices paid to dairy farmers.
Mr Kerr said this was a question that needed to be asked at the upcoming senate inquiry into the dairy industry.
"The question has to be asked of her - who told her to change those clauses? We need to know."
Mr Kerr said the code of conduct was long overdue.
"I believe there is more to this than meets the eye," he said.
"Why has this been delayed for so long?"
Pauline Hanson has also called for Ms McKenzie to resign over her "diabolical" handling of the dairy code.
The One Nation leader also took aim at Senator McKenzie, who is the Nationals' deputy leader, because her party didn't support a bill aimed at putting in place a minimum milk price.
"Senator McKenzie's handling of this whole code issue has been diabolical, it's an absolute dog's breakfast," Senator Hanson said.
Ms McKenzie rejected calls for her resignation.
The coalition has been working on the code since dairy giants Fonterra and Murray Goulburn cut milk prices paid to Australian farmers in 2016.
The wording of the code has changed significantly since being released as an exposure draft in January.
Originally, it expressly prohibited the practice of retrospective price drops for dairy farmers. It now states processors can change contract conditions if there are "circumstances beyond reasonable control".
However, a spokesman for Minister McKenzie said the plan was still set to be released by the start of next year.
"We need to make sure the code is fit for purpose, that's why we're working with dairy farmers from across the eight different dairy regions to get the code right," he said.
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