The US government formally lifted its import quota on lamb meat from Australia and New Zealand yesterday [Thursday].

The announcement had been expected for several months since the World Trade Organisation (WTO) ruled that the quota was illegal.

Restrictions ranging up to 40% on previous quotas were first imposed during the Clinton administration in 1999, and they were due to expire in July 2002. The US sheep meat industry had lobbied the government over the problems of low prices and stiff foreign competition.

Farmers in Australia responded by welcoming an end to uncertainty within their sheep industry, and thanking the abattoirs, butchers, and meat processors who supported them during the period by absorbing the costs of tariff and quota restrictions.

Ian Donges, president of the National Farmers Federation, told the Herald Sun he was "extremely pleased" that the WTO had facilitated the outcome. America was reluctant to drop the tariffs, he said, and "you can't resolve these issues on a one-to-one basis because Australia is just not powerful enough when it comes to those trade negotiations".

While signing a proclamation lifting the quota, US President George W. Bush yesterday replaced import restrictions with a US$42.7m aid package for the US lamb industry.