China hits the European Union with tariffs of up to 42% on its dairy products

The Chinese Ministry of Commerce announced this Monday the imposition of provisional tariffs on between 21.9 and 42.7% on imports of certain dairy products from the European Union, after preliminarily concluding that they receive subsidies and have caused “substantial harm” to the Chinese dairy industry. The measures, which will come into force this Tuesday, will be applied in the form of guarantee deposits that importers must provide to Chinese customs based on the customs value of the merchandise and the percentage set for each European exporting company.

The announcement comes in a context of trade tension between China and the European Union, after Beijing recently imposed tariffs of up to 19.8% on imports of certain pork products from the Twenty-seven, in what is considered retaliation for Brussels’ taxes on its electric vehicles. The anti-subsidy investigation into European dairy was launched in August 2024 at the request of the Chinese Dairy Industry Association and the Chinese Dairy Industry Association.

The Ministry indicated in a statement that it carried out the investigations under the principles of “fairness, impartiality, openness and transparency”, and in accordance with Chinese legislation and the standards of the World Trade Organization, “fully protecting the rights of interested parties.” Based on preliminary conclusions, the authorities determined that investigated dairy products from the EU receive subsidiesthat the Chinese dairy industry has suffered “substantial damage” and that there is a “causal relationship” between both factors, which motivated the adoption of provisional measures.

The investigation analyzed imports made between April 2023 and March 2024 and evaluated the effects of these purchases on the national sector during the period between 2020 and 2024. Among the programs cited were aid for ecological conservation, subsidies for young farmers, support for the storage of dairy products and funds for rural development, applied in countries such as Ireland, Austria, Belgium, Italy, Croatia, Finland, Romania and the Czech Republic.

The measures affect a range of products including fresh cheeses, curds, processed cheeses and blue cheeses, as well as milk and some types of cream. Brussels criticized the investigation from its beginning: in September 2024, the European Commission brought the case to the World Trade Organization, considering that the investigations were based on “questionable accusations and insufficient evidence,” Trade Commissioner Valdis Dombrovskis declared then.

France, which leads the table of European dairy exporters to China, is the main one affected by the anti-subsidy investigation, according to data from the General Administration of Customs of the Asian country, which also shows Italy, Denmark, the Netherlands and Spain among the biggest victims. This month, China announced the imposition of tariffs of between 4.9 and 19.8% on pork from the European Union for a period of five years, following an investigation into unfair competition that began in 2024, in a context marked by trade frictions with Brussels over Chinese electric vehicles.

Fifth product that Spain exports the most to China

Spain exported dairy products to China for 96 million dollars (about 82 million euros) in 2024which was 4.3% less compared to 2023, according to figures from the Ministry of Agriculture, Fisheries and Food (MAPA). Dairy products represent the fifth Spanish export product to Chinabehind meat, olive oil, alcoholic beverages and fish products. In 2024, according to data from Chinese customs, Spanish agri-food sales to that country totaled 2,130 million dollars (1,968 million euros), which represents a decrease of 13.2% annually, mainly due to lower pork exports.