WASHINGTON, D.C. — Exports sending beer, rye whisky and breakfast cereals to the U.S. could be stopped at the border if a trade crisis is not resolved quickly.

The U.S. administration says it will ban a wide variety of Canadian food products shipped to the U.S. The list includes fish, dairy products, baked goods, sugar, vegetables and vinegar. The value of the goods total about US$35 million a year.

“The approximate amount of annual harm to the U.S. economy caused by Canada’s dairy export subsidy regime,” it explained. The U.S. and New Zealand complained to the World Trade Organization that Canada, and the provincial governments, aren’t complying with a 1999 WTO order to end an illegal two-tiered, milk-pricing scheme.

Under the system, the price of milk sold outside Canada is lower than domestically sold milk.

“The United States does not believe that Canada has taken the necessary steps to bring its dairy export subsidy program into compliance with WTO agreements,” says the U.S. trade office.

However, the U.S. needs WTO approval before it can retaliate against Canadian exports, which is usually accomplished through high import duties.