SYDNEY, Feb 21 (Reuters) - The Australian government and trade groups are attempting to stop a new eruption in a longstanding dispute with Canada over salmon imports from spilling into major areas of trade.
This follows a World Trade Organisation (WTO) panel ruling last week that Australian restrictions of imports of Canadian salmon violate international trade rules.
Top of the list of trade retaliations being considered by Canada are Australian lamb exports, worth about A$50 million a year, followed by a range of other mostly minor exports.
Australian government and trade officials say they will work to ensure the dispute does not widen to involve major commodity exports such as raw sugar and some metals products.
Canada is one of Australia's largest markets for raw sugar, taking 616,081 tonnes in 1998/99. This made it Australia's fourth largest export market, after South Korea, which took 695,500 tonnes, Malaysia and Japan.
The Canadian Trade Department said on Friday it now had the right to retaliate against Australia and would ask the WTO to rule on the extent of retaliation Ottawa can take. The process takes 60 days.
Recent talks between the two countries to find a mutually acceptable agreement to the long-running dispute had collapsed, the Canadian trade department said in a statement.
FEDERAL OFFICIALS TO CONSULT WITH SALMON STATE
"This latest panel ruling confirms once again that the Australian measures, which continue to restrict salmon imports from Canada, are not based on science," said Canadian Fisheries Minister Herb Dhaliwal.
Australia's government would consult with authorities in the salmon-producing island state of Tasmania, where import restrictions have been imposed on salmon imports which extend beyond Federal quarantine restrictions. It will also be consulting with Canadian authorities, federal officials said.
"At the moment their retaliation list some not include some of the big export items like beef and sugar but it does include a range of other products. Depending on whether or not we can resolve the dispute there is a potential that they could target some other exports," said an official in Australian Trade Minister Mark Vaile's office said.
With Canada claiming lost trade of C$45 million, a figure with which Australia did not necessarily agree, the matter would go to a process of arbitration in the WTO, the official said.
But Canada was unlikely to target commodities which it wanted to import, he also pointed out. It could well be that the Canadians would target products produced from Tasmania, which would not include raw sugar.
The Federal government would like Tasmania to explain why it needed quarantine protection measures above already very strict commonwealth procedures, he said.
An official with Australia's national farm lobby group, the National Farmers Federation said retaliation was a lose-lose outcome and bad for trade.
Australia's national raw sugar exporter Queensland Sugar Corp had no immediate comment.:
