Beijing has unveiled provisional anti-subsidy tariffs on European Union dairy products that could reach as high as 42.7%, marking a significant escalation in the ongoing trade dispute between China and Europe. The measures, which take effect immediately, are widely understood as retaliation for the EU’s tariffs on Chinese electric vehicles. Premium European cheeses with protected origin status, including roquefort and gorgonzola, are among the targeted products.
European officials have responded with sharp criticism, describing the tariffs as baseless and unwarranted. The European Commission maintains that China’s investigation rests on questionable claims and lacks adequate evidence. Officials are now examining the decision closely and plan to challenge the findings through formal channels with Chinese authorities.
The trade conflict traces back to 2023, when the European Commission initiated an investigation into subsidies for Chinese electric vehicle manufacturers. Beijing’s response has been methodical, imposing tariffs on various EU exports including brandy, pork, and now dairy products. However, China has shown flexibility in its approach, sometimes reducing provisional tariffs or exempting certain companies in final rulings, as demonstrated in last week’s pork decision.
The new tariff structure creates different tiers of duties for affected companies. Danish dairy giant Arla Foods will pay rates between 28.6% and 29.7%, while Italian producer Sterilgarda Alimenti secured the most favorable rate at 21.9%. The harshest penalties fall on FrieslandCampina’s operations in Belgium and the Netherlands, which face the full 42.7% rate. Any company that refused to participate in China’s investigation will automatically pay the maximum tariff.
Chinese dairy producers stand to benefit from these protective measures as they navigate challenging market conditions. The domestic industry has been grappling with a milk surplus and declining prices, driven by demographic shifts and changing consumer spending patterns. China imported approximately $589 million in affected dairy products last year, representing a significant market share that domestic producers hope to reclaim.