Canada, New Zealand settle trade dispute regarding supply management of dairy sector

By Canadian Press on July 18, 2025.

OTTAWA — Canada and New Zealand have settled a dispute over Ottawa’s dairy-sector protections that regulate the cost and supply of products such as milk and cheese.

The Comprehensive and Progressive Agreement for Trans-Pacific Partnership includes certain quotas for countries to export dairy at preferred tariff rates into other member countries.

New Zealand convinced a trade panel in September 2023 that Canada was unfairly limiting its quotas to protect domestic dairy processors.

The panel ruled at the time that Ottawa had some discretion over how it allocates its dairy quotas, but that some of its rules violate the trade deal.

On Thursday, both countries said they reached an agreement for technical changes, which the Liberals say only apply to quotas under the existing deal that won’t mean more market access.

Dairy Farmers of Canada said it was “aware” of the agreement, and said it has the understanding that this results in “certain, minor policy changes” that uphold the supply-management regime.

New Zealand previously said that Canadian policies were costing its exporters the equivalent of $100 million Canadian over three years.