China Imposes Provisional Duties on EU Dairy Products Amid Trade Tensions

Post by : Saif Nasser

China has announced provisional import duties of up to 42.7% on certain dairy products coming from the European Union, a move that adds fresh strain to already tense trade relations between Beijing and Brussels. The decision follows the first phase of a Chinese anti-subsidy investigation and is widely seen as a response to the European Union’s tariffs on Chinese electric vehicles.

The new duties, which range from 21.9% to 42.7%, mainly affect products such as milk and cheese. Well-known European dairy items, including France’s Roquefort cheese, are among those covered. For most companies, the tariff rate will be close to 30%. These duties will begin to be collected from Tuesday, according to Chinese authorities.

Chinese officials have stressed that the decision is provisional. This means the rates could still change when a final ruling is made later. In a similar case involving pork imports, China reduced provisional tariffs before announcing its final decision, suggesting there may still be room for adjustment.

Trade friction between China and the European Union began to rise sharply in 2023, when the European Commission launched an investigation into whether Chinese electric vehicles were unfairly subsidised. Since then, Beijing has opened its own investigations into several EU products, including brandy, pork, and now dairy. These actions are widely viewed as countermeasures aimed at pressuring the EU during trade talks.

China’s Ministry of Commerce said it found evidence that EU dairy producers were receiving subsidies that harmed Chinese farmers and companies. Around 60 European firms will be affected. Major dairy producers such as Arla Foods will face duties of around 28% to 30%. Italy’s Sterilgarda Alimenti will pay the lowest rate, while FrieslandCampina’s operations in Belgium and the Netherlands will face the highest duties of 42.7%. Companies that did not cooperate with the investigation will also be charged the top rate.

The European Commission has not yet issued an official response. Meanwhile, negotiations between China and the EU over electric vehicle tariffs reportedly resumed earlier this month, but no new outcome has been announced. European diplomats have indicated that serious disagreements still remain.

China imported about $589 million worth of EU dairy products covered by the investigation in 2024, similar to the level seen in 2023. While this is a relatively small share of total trade between the two sides, the move sends a strong signal about China’s willingness to use trade tools to protect its interests.

Inside China, the decision is likely to be welcomed by local dairy producers. The domestic dairy industry is under pressure due to falling demand, lower milk prices, and declining birth rates, which have reduced consumption of milk products. China is the world’s third-largest milk producer, and authorities have already urged farmers to cut excess supply and reduce herd sizes.

Overall, the new duties highlight how trade disputes can spread from one sector to another. What began as a disagreement over electric vehicles has now reached Europe’s dairy industry, showing how deeply connected global trade has become and how quickly tensions can affect everyday products like milk and cheese.