China has imposed provisional tariffs of 21.9% to 42.7% on select European Union dairy imports following an anti-subsidy investigation. The duties, effective Tuesday, largely result in rates around 30% for most companies. The measures are widely interpreted as retaliation for EU electric vehicle tariffs.
The European Commission has condemned the move as unjustified and based on inadequate evidence. Officials argue that the investigation relies on questionable allegations without sufficient proof. Brussels is reviewing the decision and preparing formal objections.
Trade friction began in 2023 when the European Commission initiated an investigation into Chinese electric vehicle subsidies. Beijing has responded with tariffs on European spirits, pork, and dairy products. Despite this aggressive approach, China has occasionally demonstrated flexibility by reducing final tariffs.
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.
The decision is likely to be welcomed by Chinese producers who are grappling with a glut of milk and falling prices as declining birthrates and more cost-conscious consumers weigh on demand. China imported $589 million of dairy products covered by the investigation last year. Authorities urged producers last year to rein in output and reduce older, less productive cows.
