Minister Sidhu and Minister MacDonald statement on resolution of the CPTPP dairy tariff rate quotas dispute with New Zealand

July 17, 2025 – Ottawa, Ontario - Global Affairs Canada

The Honourable Maninder Sidhu, Minister of International Trade and the Honourable Heath MacDonald, Minister of Agriculture and Agri-Food, issued the following statement on the resolution of the dairy tariff rate quotas (TRQs) dispute with New Zealand under the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

“This Government remains committed to maintaining, protecting and defending supply management, and standing up for the dairy industry, farmers, workers and the communities they support.

“Canada has reached a mutually satisfactory solution with New Zealand to resolve the CPTPP dairy TRQs dispute. This agreement, negotiated in close consultation with Canadian dairy stakeholders, will result in certain minor policy changes to Canada’s TRQ administration, and does not amend Canada’s market access commitments. These technical policy changes are limited to quotas administered under the terms of the CPTPP, and will not negatively impact Canada’s dairy industry or supply management.

“With these changes, New Zealand has confirmed that it will not take further action under the CPTPP dispute settlement process.

“This outcome shows how Canada and New Zealand, key CPTPP partners, worked together to use the mechanisms established under the trade agreement to resolve differences. Canada and New Zealand will continue to work together to promote trade and investment under the CPTPP and in other fora.”

Quick facts

• Today’s announcement follows the dispute settlement process initiated under the CPTPP by New Zealand in 2022.
• These technical policy changes primarily include:
  • earlier return dates;
  • introducing a chronic return penalty;
  • introducing an underfill mechanism for TRQs with lower fill; and
  • increasing data transparency.
• These changes will be published on October 1, 2025, for implementation beginning with the 2026 calendar year dairy TRQs.
• Canada’s dairy sector is a vital pillar of rural communities and a key driver of the economy. Located across the country, these 9,256 farms and 549 dairy processing plants generated $8.9 billion in farm cash receipts and $19.3 billion in sales respectively in 2024. Together, dairy production and processing activities account for more than 70,000 jobs. 

Associated links

• Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP)
• Canada’s Dairy Tariff Rate Quota (TRQ) Allocation Measures