‘Fill the gap’: Australia’s plan to swoop on Trump’s trade war with Canada

Washington: Trade Minister Don Farrell will seek greater market access for Australian wines and spirits in Canada at a G20 summit this week, in a push to capitalise on the trade war between US President Donald Trump and his North American neighbour.

He will also call on the United States to honour its obligations under the free trade agreement with Australia by removing tariffs and refraining from applying new ones to Australian lamb, arguing that Trump’s tariffs are a potential roadblock to the relationship.

“Our argument is that we want good relations with the United States,” Farrell said in an interview. “They’re our second-largest trading partner. They’re our most important military partner … At the moment, our trade relationship is overwhelmingly in their favour.”

Australia supplies about half the entire American lamb market. Farrell warned that hitting imports with tariffs, which is currently under consideration, would only hurt average Americans, as they had with beef.

“It has an impact on their cost of living,” he said. “We think it’s counterproductive for them to apply tariffs to products like lamb, which simply pushes up the price for ordinary American consumers.”

Farrell will make that case directly to US Agriculture Secretary Brooke Rollins when he and other G20 trade ministers convene in Milwaukee, Wisconsin, this week.

He will also meet with Canada’s International Trade Minister Maninder Sidhu to discuss ways in which Australia can exploit the gap in Canada’s alcohol market left by the spiralling trade war between Washington and Ottawa.

Canadian provincial governments generally control alcohol sales and began banning American products last year amid Trump’s tariffs and his bid to make Canada the 51st US state. A retaliatory ban on Canadian alcohol products in the US took effect on Tuesday (US time).

Farrell said Australia was well positioned to “fill the gap” in Canada. Australian wine exports to Canada already climbed 13 per cent in volume and 20 per cent in value to $188 million in 2025-26.

“I think if we were to quickly fill that gap, it would be worth more than $100 million at the start,” Farrell said. “It’s a significant figure at a time when the wine industry is facing difficulties right around the country.”

Canada is a priority growth market for Australian wine producers under the Accessing New Markets Initiative, a $55 million government strategy to help industry take advantage of global economic uncertainty caused in part by Trump’s tariffs.

Australia will use the summit to continue aligning itself with Canada and other middle powers who are seeking to form new partnerships and deals as the US retreats from multilateralism under Trump.

Last week in New York, Prime Minister Anthony Albanese channelled Canada’s Mark Carney by declaring the post-1945 world order was “no longer fit for purpose”.

Australia’s alignment with Canada will not go unnoticed by Trump and senior White House trade counsellor Peter Navarro, who both railed against Canada during an event in the Oval Office on Monday (US time).

Trump called them “one of the worst countries in the entire world” on trade, while Navarro said the Canadians were “the most difficult and arrogant” of all.

Farrell brushed aside concerns about Trump’s position.

“We make decisions based on our national interest,” he said. “We are very definitely in the category of those countries that believe in free and fair trade.”

Also on the Australian agenda in Milwaukee are meetings with the European Union on the implementation of March’s trade agreement, and India, as Canberra looks to negotiate a second, broader free trade deal with the world’s most populous nation. Farrell is also scheduled to meet with South Korea and Saudi Arabia.

Last year, as Australia sought to shore up its position with the Trump administration following the now-illegal Liberation Day tariffs, Canberra tweaked the rules to allow American beef into Australia. The change was heralded by the Trump administration as a significant win for American farmers.

However, that has not resulted in a discernible rise in US beef exports to Australia, which remain negligible. And Australian beef exports to the US have continued to climb to record highs.

Farrell said there was no new offer on the table from Australia in return for tariff relief or a reprieve on lamb. The US International Trade Commission is conducting an investigation into whether lamb imports are a threat to the domestic industry, which could be a precursor to tariffs.

But US trade ambassador Jamieson Greer is likely to renew concerns about Australia’s growing regulations on technology, including the proposed digital duty of care, which the US says may disproportionately impact American companies.

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