Liam Fox faces embarrassment after New Zealand formally objected to a plan that would limit the amount of its lamb sold in Britain.

New Zealand was one of the first countries to offer to enter trade negotiations after the EU referendum. Its rebuke is the latest indication of the difficulties that Dr Fox’s international trade department must negotiate after the row over chlorine-washed chicken that overshadowed his visit to the US.

At the centre of the disagreement with New Zealand are agricultural quotas that protect domestic producers in the EU by limiting the amount of food and livestock that can be imported before high tariffs are applied. Officials from New Zealand have challenged the government’s plan to share these quotas with the European Union after