Beijing has announced provisional anti-subsidy tariffs of 21.9% to 42.7% on European Union dairy products starting Tuesday. Most affected companies will face duties around 30%. China’s ministry of commerce said in a statement it had found evidence that EU dairy imports were subsidized and hurting Chinese producers.
The European Commission has rejected the tariffs as illegitimate and poorly substantiated. Spokesperson Olof Gill stated that the investigation is based on questionable allegations and insufficient evidence. Brussels is examining the decision closely and preparing formal comments.
Trade tensions escalated in 2023 when Europe began investigating subsidies for Chinese electric vehicle manufacturers. China has responded with tariffs on multiple European products including spirits, pork, and dairy. However, Beijing has occasionally shown flexibility, reducing provisional tariffs in final rulings.
Approximately 60 companies will face the new tariffs at varying rates. Arla Foods will pay between 28.6% and 29.7% on brands like Lurpak and Castello. Italy’s Sterilgarda Alimenti secured the most favorable rate at 21.9%, while FrieslandCampina’s Belgian and Dutch operations must pay 42.7%. Non-cooperative companies automatically receive the highest tariff.
Chinese dairy producers are likely to welcome these measures as they grapple with oversupply and declining prices. Declining birthrates and more cost-conscious consumers have weakened demand. Last year, China imported $589 million in affected dairy products. Authorities have encouraged domestic producers to curtail production and reduce livestock numbers to stabilize prices.