Gladigau said smaller cheesemakers could be put out of business. He described the industry’s meetings with Farrell and Australian government negotiators as “extremely positive”, but said he did not think the EU would give up on the names issue “without a fight”.

“I’d be pretty disappointed if dairy became the scapegoat for something else just to get this across the line,” Gladigau said.

“We’ve had the minister come out from early on and say, ‘we’re not going to sign a deal that’s not beneficial to Australia’. So we go, OK, that’s good, that’s what we want to hear, just don’t dump dairy as part of that trade.”

Gladigau said the Australian dairy industry would face costs of $75m to $90m in the first year if the EU got everything it wanted. That was based on expanded EU market access to Australia and also the renaming and repackaging costs.

He said there would also have to be a campaign to educate consumers. “If you’re looking at a recipe that says you’ve got to add feta to this salad and you go into the shop and you see feta, which would be European, and you see who knows what else which would be Australian, you’d go, well, I don’t know what that is, I’ll buy the feta.”

Lee McLean, the chief executive officer at Australian Grape & Wine, said giving ground on the prosecco name would be “a very dangerous precedent”.

He cited the fact the EU had renamed the grape variety to Glera in 2009, in order to seek to reserve the use of the name prosecco for wines produced in an Italian region.

McLean said Australian producers had invested in good faith in that grape variety name but the EU had “effectively changed the rules on us”.

“We wouldn’t want to see that happen to prosecco producers in Australia, but we’re also concerned about all those other producers that could risk having other grape variety names taken away from them in similar circumstances if that precedent is set.”

McLean said wine producers had been talking with Farrell and the government “for a long period of time”.

“We feel that he understands the issue and we note that he hasn’t made any concessions on this issue of prosecco yet. It’s really important that he maintains that principled approach,” McLean said.

The Coalition’s trade spokesperson, Kevin Hogan, said free trade agreements were “like a game of poker” and he urged Farrell to hold firm.

“Don’t blink,” Hogan said.

The EU is already Australia’s third-largest trading partner, but Australian negotiators are pushing for greater market access for exports such as beef, sheep meat and dairy.

“Europe represents a group of nations, 450 million people, an economy of $23 trillion. So this is a really big potential market for Australia,” Farrell said.

Asked whether a deal would be possible without Australia giving ground on the product names issue, Farrell said he wished he “had the final answer to that”.