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The EU and Australia are engaged in last-minute haggling over food imports as they push to clinch a long-delayed trade deal next month.

European Commission president Ursula von der Leyen is expected to travel to Australia in February to sign the pact, which the two sides have failed to sign on three previous occasions despite ongoing talks since 2018.

The Commission is hoping to build on its success earlier this month when sufficient EU member states backed the bloc’s biggest trade deal with the Mercosur group of South American countries.

But Brussels and Canberra are still bargaining over how much beef and sheep Australian farmers could export to the EU.

Six member states, including France and Poland, refused to support the Mercosur pact over concerns that increased meat imports would damage European farmers’ livelihoods, giving Brussels little room to compromise with Canberra.

The Mercosur countries, which include Brazil, Argentina, Uruguay and Paraguay, were handed 99,000 tonnes of low tariff beef imports annually, equivalent to 1.5 per cent of annual EU production.

The EU is offering Australia about 24,000 tonnes of beef and 20,000 tonnes of sheep, according to people familiar with the situation, with Canberra demanding about double those levels.

Talks collapsed in 2023 over the issue when Australian trade minister Don Farrell dramatically pulled out of a meeting in Japan to conclude the deal.

But EU officials believe that Donald Trump’s decision to apply tariffs on Australia, one of America’s staunchest allies, could push Canberra to reduce its demands. The US president imposed a baseline duty of 10 per cent on Australian goods.

Other sticking points that have led to talks collapsing previously have included how long Australian producers can continue to use names such as feta and prosecco, which are protected under EU law.

An EU diplomat said it had been tough to negotiate an agreement since 2018 because of the differing priorities of the two main Australian political parties. “There is a feeling there are two Australias depending who is in government, the Conservatives or Labour. But it is a deal that should be possible.”

EU farming lobby group Copa-Cogeca said it would consider the overall impact of any deal with Australia, given it would create opportunities for European wine, spirits and cheese producers. But a spokesperson added that Brussels should not offer “one more kilo” of meat. 

Farrell described a trade deal with the EU as “the missing piece of the puzzle” in a speech last year and said he was committed to finalising the terms.

Australia’s burgeoning position in the supply of rare earths and critical minerals that are essential to the manufacture of automotive and defence equipment could also strengthen its negotiating stance.

The EU is already one of Australia’s largest trading partners with total trade of A$109.7bn ($73bn) in 2024 according to government figures, driven by coal exports, tourism and imports of pharmaceuticals into Australia.

Trade bodies, led by the European Australian Business Council, have projected a A$7.4bn boost to Australian GDP by 2030 if an EU trade deal is agreed.

Australia’s need to diversify its export markets for products including wine and beef has grown since China imposed punitive tariffs on some of the country’s key exports in 2020 during a diplomatic dispute. In December Beijing imposed caps on beef imports. Canberra has also targeted growth in India, south-east Asia and the UK. 

François Chimits, head of the Europe programme at the think-tank Institut Montaigne in Paris, said it was unlikely France would support the deal with Canberra despite its geopolitical benefits. 

However, given there was not a big enough minority of EU member states to block the Mercosur pact, “I hardly see one for Australia”, he said.