China has implemented provisional tariffs ranging from 21.9% to 42.7% on select European dairy imports effective Tuesday. Most companies will face duties around 30%. The decision follows an anti-subsidy investigation seen as retaliation for EU electric vehicle tariffs.
The European Commission has strongly criticized the tariffs as unwarranted and lacking proper foundation. Officials argue that the investigation is based on questionable claims and insufficient evidence. Brussels is conducting a detailed examination and preparing formal comments.
Trade tensions began in 2023 when the European Commission launched an investigation into Chinese EV subsidies. Beijing has imposed tariffs on EU brandy, pork, and now dairy. However, as it did with pork, Beijing has reduced or limited the impact of its tariffs several times, including partly sparing major cognac producers Pernod Ricard, LVMH and Rémy Cointreau after its brandy investigation.
Approximately 60 companies face the new tariffs at varying rates based on cooperation. Arla Foods will pay between 28.6% and 29.7%. Italy’s Sterilgarda Alimenti faces the lowest rate at 21.9%, while FrieslandCampina’s Belgian and Dutch facilities must pay 42.7%. Companies that refused to participate automatically receive maximum penalties.
Chinese dairy producers are expected to benefit from these protective measures as they deal with excess supply and falling prices. Declining birthrates and budget-conscious consumers have reduced demand. Last year, China imported $589 million in affected dairy products. Authorities previously urged domestic producers to limit output and reduce herd sizes.
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