Why it matters: Canada’s supply management system remains a sticking point in trade negotiations with the U.S.

“This agreement, negotiated in close consultation with Canadian dairy stakeholders, will result in certain minor policy changes to Canada’s TRQ (tariff rate quotas) administration, and does not amend Canada’s market access commitments,” International Trade Minister Maninder Sidhu and Agriculture Minister Heath MacDonald said in a statement.

New Zealand Trade Minister Todd McClay added in a separate statement that the government was pleased the dispute has now been settled, and New Zealand exporters are guaranteed better access to the Canadian market.

“Today’s agreement reinforces support for the rules-based trading system,” McClay said.

New Zealand launched a claim against Canada in May 2022, arguing that Ottawa’s implementation of dairy tariff rate quotas under the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) trade agreement were against the its rules.

Under the new agreement, Canada has committed to make commercially meaningful changes to the way it administers its dairy quotas under CPTPP, according to the New Zealand government. The Canadian government added that this means there are technical policy changes but these are limited to quotas administered under the terms of the CPTPP.

Canada’s supply management system, which since the 1970s has tightly controlled supplies of dairy, eggs and poultry by restricting production and limiting imports through onerous tariffs, has become a sticking pointing in its ongoing trade negotiations with the U.S.

President Donald Trump has repeatedly criticized what he calls tremendously high Canadian tariffs on dairy products.

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Oceania is the last region of the world free of the H5N1 clade 2.3.4.4b avian influenza that has killed hundreds of millions of birds and tens of thousands of mammals since appearing in Asia, Europe and Africa in 2020, littering beaches with corpses and upending the agricultural industry.

While the region is somewhat protected by its geography – it is off the migration routes of big birds such as geese that spread infection – the virus is close, having reached Indonesia in 2022 and Antarctica last year.

Scientists and officials say there is a higher risk, particularly in Australia, of it arriving with smaller migratory shore birds during the Southern Hemisphere springtime months from September to November.

“It is clearly a threat to our country’s ecosystems,” said Fiona Fraser, Threatened Species Commissioner at Australia’s environment ministry.

“Many of our species are found nowhere else in the world,” she said. “Vulnerable species may face long-term population setbacks and heightened risk of extinction.”

Officials fear mass deaths from the avian flu and even the near-extinctions of species including endangered sea lions, black swans and many types of seabird, and the loss of millions of farmed poultry.

Over 100 million chickens and turkeys have died or been culled in the United States alone from this H5N1 strain, causing economic losses of up to $3 billion by the end of last year, according to the Council of Foreign Relations, a U.S. think tank.

The virus killed around 50,000 seals and sea lions and more than half a million wild birds as it moved through South America beginning in 2022.

It has also infected cattle in the United States and, in rare cases, people. Health officials say the risk to humans is low.

New Zealand is also unlikely to avoid the virus long-term, said Mary van Andel, chief veterinary officer for the country’s Ministry of Primary Industries.

“Geographic isolation has protected us from HPAI (high pathogenicity avian influenza) in the past, but we can’t rely on it forever,” she said.

‘Wartime’

Both countries have intensified preparation.

Australia created a task force across government departments and stress-tested its preparedness in August and September with a series of exercises simulating an H5N1 outbreak in wildlife.

New Zealand has trialled a vaccine on five endangered native birds and said it could be rolled out to more species.

“We’re super paranoid about those five species, because the risk to them of losing the breeding population is that we could lose the species,” said Kate McInnes, science advisor at New Zealand’s Department of Conservation.

Australia is also developing options for vaccinating threatened wild birds held in captivity, officials said. The two vaccination schemes are among the only ones for non-farmed animals in the world.

Farms are boosting biosecurity measures including limiting contact between poultry and wild birds, monitoring employees’ movement, sterilising water and equipment and installing automated systems that detect wild birds and scare them away, industry officials from both countries said.

While Australia has had numerous outbreaks of highly pathogenic bird flu strains in poultry flocks, including earlier this year, they were less-virulent strains that did not spread through wild birds.

New Zealand has never faced high pathogenicity bird flu. Its poultry industry association has organised trips to both Australia and Britain to learn from farms there.

“We’ve been at peacetime,” said Poultry Industry Association New Zealand Executive Director Michael Brooks. “Frankly, now we’re potentially heading to wartime.”

Oceania has had longer than other regions to prepare for the arrival of H5N1, but while the poultry industry can lock down, wild populations cannot be contained.

“We’ve learned a lot from the way the disease has spread across the world. We’ve stepped up our preparedness as best we can,” said Brant Smith, an official at Australia’s agriculture ministry overseeing the country’s response.

“But every single continent has seen huge mortality events in wildlife. We are likely to see this occur here too.”

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Science, Innovation and Technology Minister Judith Collins said in a statement that rules and time-consuming processes have made research outside the lab almost impossible.

“These changes will bring New Zealand up to global best practice and ensure we can capitalize on the benefits,” she said.

Current, regulations mean that genetically modified organisms (GMOs) cannot be released out of containment without going through a complex and vigorous process and it is difficult to meet the set standard. Furthermore, gene editing is considered the same as genetic modification even when it doesn’t involve the introduction of foreign DNA.

Under the new law, low-risk gene editing techniques that produce changes indistinguishable from conventional breeding will be exempted from regulation, local authorities will no longer be able to prevent the use of GMOs in their regions and there will be a new regulator of the industry.

“This is a major milestone in modernizing gene technology laws to enable us to improve health outcomes, adapt to climate change, deliver massive economic gains and improve the lives of New Zealanders,” Collins said.

The government hopes to have the legislation passed and the regulator in operation by the end of 2025.

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