The trade deal between the UK and New Zealand is “a blow” to the UK dairy industry, a committee of MPs has been told.

“New Zealand has a clear competitive advantage in dairy, that’s well acknowledged in the government’s impact assessment. It (the trade deal) opens up the UK market to potential unlimited New Zealand imports in a fairly short timeframe,” said Peter Dawson from industry body Dairy UK.

Speaking at Westminster’s International Trade committee, Dawson acknowledged that the New Zealand dairy sector is mainly focused on “lucrative and growing markets” in Asia at present, but he suggested this could quickly change in the future.

“There may be situations where they decide as a matter of necessity to re-orientate very rapidly into the UK market. Because of the competitive advantage that they have, they will be able to obtain a market share up to any limit that they decide is necessary,” he said.

MPs were told that the trade deal offers little opportunity for UK food producers and exporters, as New Zealand has a relatively small market of 5m consumers.

It was a point accepted by New Zealand’s former agriculture minister Sir Lockwood Smith, although he suggested the trade deal can be used as “a stepping stone” for the UK to join the trans-Pacific trade agreement known as CPTPP.

“CPTPP does offer real market opportunities for the UK. It introduces you across a spectrum of countries in Asia and the Asian Pacific. Some of those countries have big populations and growing middle classes with real interest in the products and services that the UK produces,” Smith said.