Karrinjeet Singh-Mahil has milked cows at Crossley for almost three decades. Australia’s new trade deal with Europe, set to be introduced next year, was meant to open a door for farmers like her in Australia, but she says the dairy quotas are “pitiful”.
Still, she doesn’t want it scrapped: “If you throw that agreement out, you’re throwing out a whole lot of other stuff that is good for Australia.”
North of Mortlake, beef farmer David Allen believes the deal has left beef farmers “shortchanged”.
What’s going on: Both farmers were responding to comments from Wannon MP and Shadow Energy Minister Dan Tehan. In a recent interview with Politico, Tehan said the deal’s access for Australian agriculture was “abysmal”.
Dairy farmers in his electorate, he said, “go backwards” under it, and beef access was “bordering on insulting”.
Asked to clarify his comments, Tehan said dairy farmers across Wannon have been “appalled that EU dairy farmers have greater preferential access to the Australian market than Australian dairy farmers have to the EU market”.
What is it? The EU free-trade agreement is a trade deal between Australia and the EU’s 27 member countries, finalised in March 2026s. It cuts or removes the tariffs, or import taxes, each side charges the other.
Right now, Australia can send about 4400 tonnes of beef a year to the EU at a lower tax.
Over 10 years, the deal lifts that to about 35,000 tonnes.
About 21,000 tonnes will be tax-free, and the rest will pay a small 7.5% tax. Any extra beef pays the full rate.
Aussie Dairy has had even less access to the EU market. Until now, only small amounts of cheese got a tax break.
The deal will remove EU taxes on most Australian dairy products, including cheese, yoghurt and whole milk powder, mostly within three years. There’s no set limit on how much can be sent.
What else: Butter, skim milk powder and whey are the exceptions. The EU treats them as its most sensitive products, so Australia can only send a fixed amount tax-free each year: 5000 tonnes of butter, 8000 tonnes of skim milk powder and 2000 tonnes of whey.
New Zealand got a better deal on these few sensitive products. It can send three times as much extra butter as Australia, and more whey.
The deal is expected to be signed in late 2026 or early 2027, and could take effect from late 2027.
The federal government called the deal “a win-win”. Prime Minister Anthony Albanese said in March it would remove tariffs on exports including beef and dairy.
How it affects dairy farmers: Singh-Mahil said the quota system holds dairy back, however well farmers perform.
Australian Dairy Farmers, a national industry body, said Australia imported almost $1 billion of EU dairy last year but sold just $29 million back.
It has called the deal the “Un-Fair Trade Agreement”,, saying it lets in more imports “without delivering comparable new export opportunities”, and said that EU naming rules mean local producers give up established commercial freedoms.
DFAT said most of the dairy Australia sells overseas will be able to enter the EU tax-free. Right now, Australia sells very little dairy to Europe.
How it affects beef farmers: Beef did better than dairy on paper, but many producers are still unhappy. Allen, who runs about 2,000 cattle on his multi-generational farm, thinks Australia was still “shortchanged”.
Industry groups agree. They had asked for 50,000 tonnes of extra beef access and got 30,600. Cattle Australia chair Garry Edwards called the amounts “pathetic”, with “headline trivial volumes not reached for 10 years”.
Australian beef exports to the EU were worth $197 million in 2025. DFAT says the new access could be worth up to $661 million a year.
For his own farm, he doesn’t expect much to change: “All our cattle go into Coles, so we provide a couple of the branded products, so it's got no implication for us in terms of trade.”
Climate target requirements: The deal includes binding climate commitments. Both sides must put the Paris climate agreement into practice, and the European Commission says serious breaches could, as a last resort, lead to trade sanctions.
Separately, EU rules such as its deforestation law can require exporters, including beef producers, to prove their products aren’t linked to recently cleared land.
Tehan objected to climate being “brought into a free-trade agreement”, something he said the Coalition avoided in government.
The Coalition has promised to scrap the net zero by 2050 target and repeal the Climate Change Act, but hasn’t said whether it would set any emissions reduction target. Tehan said it would announce its reductions “in the lead-up to the next election or thereafter”.
Not waiting for Canberra: The Coalition has said it would take “a more laser-like focus to adaptation”, arguing efforts to cut emissions are “having limited success at best”.
But farmers say they’re already adapting. Singh-Mahil said farmers are the ones who see climate change “first and see it worst”, and some are already cutting emissions because it pays.
“Some of the bigger family farmers have got solar panels and batteries, and don't even use the grid unless they absolutely have to. Not only is it cheaper for them to do that, but it makes it more reliable,” she said.
Allen is already adapting. He said this is “the third year in a row” with about half the region’s usual rainfall, so he monitors tank levels with farm bots, checks pipes for leaks and plants trees for shade.
Cutting emissions to keep buyers: Allen is also cutting emissions, and he says it now comes up in his dealings with buyers. He has cut emissions “every year for the last four years”.
“If you are on that track, you become a preferred supplier. If you’ve got market access, you’ve got the job half won,” he said.
He says walking away from emissions targets, as the Coalition has promised to do, would “be disastrous” for Australian trade.
“Our trading partners are going gangbusters in reducing emissions … we will be out on our own if we elect not to take any action against climate change,” he said.
“The writing's on the wall. The figures are in, the data's in, it's hotter, drier … why wouldn't you try and mitigate it?”