Australia, EU trade ministers spoke as hopes of free trade deal rise - source

SYDNEY, June 30 (Reuters) - Australian and European Union trade ministers spoke on Thursday evening, a source familiar with the matter told Reuters, as optimism builds that sticking points over a free trade agreement (FTA) can be overcome with more negotiation.

A trade deal with the EU, a market of around 450 million consumers, would be a significant boost for Australia's push to diversify its export markets, after major trading partner China imposed blocks on a raft of Australian agricultural products in a 2020 political dispute.

Negotiations between Trade Minister Don Farrell and EU Trade Commissioner Valdis Dombrovskis stalled in Brussels in June.

However, Australian assistant trade minister Tim Ayres said on radio on Friday another meeting could be held in the next fortnight.

"I think it's likely that there will be a return to ministerial-level negotiations," Ayres told ABC Radio.

"There has to be a very clear indication on the European side that we're going to make commercially meaningful access in terms of agriculture," he added.

The source told Reuters that Farrell and Dombrovskis spoke on Thursday evening.

Farrell has previously said Australia wants better access for Australian beef, sugar and sheep meat before it signs a deal.

Agriculture Minister Murray Watt will meet with the EU agriculture commissioner, and ministers from several European nations, to push for better market access for Australian producers when he attends the United Nation's Food and Agricultural Organisation conference in Rome this week, he said.

"We believe it is possible to reach an agreement which benefits both Australia and the EU and we will continue striving to achieve that," Watt said in a statement on Friday.

There is optimism that an agreement could be struck by mid-year.

Dombrovskis wrote in a Tweet he had discussed the FTA in a meeting with the European Australia Business Council, a business organisation, in Brussels on Wednesday, and sent his condolences on the sudden death in Germany on Sunday of the council's chairman Simon Crean, a former Labor party leader. (Reporting by Kirsty Needham Editing by Mark Potter)