trade agreement

Three deals across three key regions : Mercosur, India and Australia.

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While the Commission hailed the Australia agreement as a new geostrategic win, EU farmers continue to express deep discontent stemming from the Mercosur deal.

In practice, the backlash around the agreement with Argentina, Brazil, Paraguay and Uruguay has done little to shift the Commission’s dual approach in its negotiating line. On the one hand, the commission kept making concessions on entry-level or mid-range farm goods such as beef, while on the other hand, it pushed for market access for high value-added exports —like wine, Geographical Indications (GI) and cars— with mixed results.

“The EU has all the assets to be an agri-food power,” Luc Vernet, from the export-focused brussels think tank Farm Europe, told Euronews, adding: “We should develop a broader strategy beyond high value-added products, covering all sectors and all levels of quality, because the European model delivers exceptional quality not just in luxury products.”

Yet the opposition to the Latin America deal — which triggered a legal challenge suspending its ratification — crystallised among EU farmers over fears of unfair competition from meat imports.

The Mercosur agreement granted quotas of 99,000 tonnes of beef per year, 25,000 tonnes of pork and 188,000 tonnes of poultry. Despite conditions added to new quotas in the Australia deal, EU farmers complain of imports piling up across successive agreements.

Concessions made on beef

Over eight years of talks with Canberra—the world’s second-largest beef exporter—Australia pushed hard for greater access for beef and sheep meat. Tensions intensified in 2023, when negotiations broke down after the EU rejected Australia’s demand for 40,000 tonnes of beef per year, offering no more than 30,000 tonnes instead.

The final deal agreed Tuesday allows 30,600 tonnes of beef annually into the EU. For sheep and goat meat, Brussels accepted a 25,000-tonne duty-free quota, while sugar was limited to 35,000 tonnes of raw cane for refining and rice to 8,500 tonnes a year.

However, perhaps drawing lessons from Mercosur, Brussels imposed multiple conditions on the quotas. Beef imports, which will have to be from grass-fed cattle, will be phased in over 10 years, sheep meat over 7 years, and rice over 5 years. Sugar will also be subject to certification under a private sustainability scheme.

Safeguard clauses, allowing both sides to react to market disruption, will apply for seven years – but are extended for sensitive farm goods : 15 years for beef, 12 for sheep and 10 for rice.

But a farmers’ representative told Euronews there were serious doubts about the effectiveness of the safeguard mechanisms: “Our experience in general with safeguards is that they are extremely difficult to activate because the burden of the proof is on us, farmers.”

The offensive agenda of the Commission

By contrast, agriculture was far less contentious in the India negotiations, where New Delhi itself resisted opening its market due to domestic farm sensitivities, particularly in dairy. EU sensitive products were largely excluded.

But wine featured prominently on Brussels’ offensive agenda, with Indian tariffs cut from 150% to 20% for premium wines and 30% for mid-range products over seven years. Tariffs for cars will also fall from 110% to 10% but under a quota of 250,000 vehicles a year after a decade – by which point Chinese manufacturers have great chances to have strengthened their position.

In negotiations with Australia, the EU again sought greater access for its wine but encountered strong opposition from domestic producers. In the end, the deal protects more than 1,600 EU wine GIs, plus over 50 new ones from 12 member states.

On Prosecco, Australian producers will still be allowed to use the term domestically to designate a grey grape variety, provided it is linked to Australian GI, with Canberra agreeing to stop exporting such wines after 10 years.

The EU also secured protection for 165 agri-food GIs and 231 spirit drink GIs. But it failed to remove Australia’s luxury car tax, securing instead preferential treatment for EU electric vehicles. But Brussels won improved access to critical raw materials – a key EU demand, that may have lead to more concessions on meat.

Published on
24/03/2026 – 1:25 GMT+1

European Commission President Ursula von der Leyen on Tuesday sealed a free-trade agreement with Australian Prime Minister Anthony Albanese, slashing tariffs on most EU goods and farm exports.

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The deal marks another win for Brussels as it races to diversify trade ties and lock in strategic partners amid rising global tensions.

The pact will save the EU €1 billion a year in duties, the Commission said, with exports projected to climb as much as 33% over the next decade.

Agriculture proved a flashpoint, with EU farmers already pushing back against the Mercosur trade agreement and a legal challenge from MEPs threatening ratification.

Tariffs will eventually fall to zero on products including cheese (over three years), wine, some fruit and vegetables, chocolate and processed foods.

On the toughest issues — beef and sheep, which sank talks in 2023 — Australia agreed to quotas of 30,600 and 25,000 tonnes a year, respectively.

A safeguard mechanism will allow the EU to shield sensitive sectors if a surge in Australian imports harms the bloc’s market.

Beyond agriculture, the agreement opens access to Australia’s critical raw materials, including aluminium, lithium and manganese.

Brussels also failed to scrap Australia’s luxury car tax. Instead, 75% of EU electric vehicles will be exempt.

The deal is a geostrategic push

The Commission expects strong export gains in key sectors, including dairy (up to 48%), motor vehicles (52%) and chemicals (20%).

Brussels has prioritized the deal as it builds partnerships in the Indo-Pacific, where China’s influence has become central. A security and defence partnership with Canberra was also announced Tuesday.

“The EU and Australia may be geographically far apart but we couldn’t be closer in terms of how we see the world,” von der Leyen said, adding: “With these dynamic new partnerships on security and defence, as well as trade, we are moving even closer together.”

Since Donald Trump returned to power in 2025, trade agreements have taken on sharper geostrategic weight for the EU as it seeks new markets.

In 2025, Brussels struck deals with Mexico, Switzerland and Indonesia. The Mercosur pact was also signed earlier this year and will be provisionally applied from 1 May despite a European Parliament legal challenge.

More could follow. Talks are ongoing with the Philippines, Thailand, Malaysia, the United Arab Emirates, and countries in Eastern and Southern Africa, von der Leyen told EU ambassadors on 9 March.

Published on
23/03/2026 – 15:14 GMT+1

The European Commission on Monday took final steps to provisionally apply the Mercosur trade deal from 1 May, covering Argentina, Brazil, Paraguay and Uruguay.

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The move uses a special procedure to ensure the deal takes effect despite a judicial review launched by the European Parliament after a pivotal 21 January vote suspended ratification.

“The priority now is turning this EU-Mercosur agreement into concrete outcomes, giving EU exporters the platform they need to seize new opportunities for trade, growth and jobs,” EU Trade Commissioner Maroš Šefčovič said, adding: “Provisional application will allow us to begin delivering on that promise.”

The agreement liberalises trade flows between the EU and Mercosur countries, creating a free-trade area of more than 700 million people.

The Commission signed off on the deal and secured backing from EU member states despite strong opposition from EU farmers, who fear unfair competition from Mercosur imports.

But at the European Parliament, opponents secured a majority to refer the agreement to the Court of Justice of the European Union to assess its legality.

Pressed by supporters including Germany and Spain, which are seeking faster access to new markets amid rising geoeconomic tensions, the Commission opted for provisional application.

To proceed, it had to wait for at least one Mercosur country to ratify and notify the agreement before launching provisional implementation with that country. Argentina, Brazil and Uruguay have done so, while Paraguay ratified the deal last Tuesday and “is expected to send its notification soon,” the Commission said.

On Monday, the Commission sent a “verbal note” to Paraguay, the legal guardian of Mercosur treaties, completing the final procedural step.

“Provisional application ensures the removal of tariffs on certain products as of day one, creating predictable rules for trade and investment,” the Commission said.

“It will create more resilient and reliable supply chains, crucial in particular for the predictable flow of Critical Raw Materials.”