Items covered by the new tariffs include fresh cheese, processed cheese products, and certain categories of milk and cream. The ministry did not specify the volume or value of dairy imports affected, but the EU is a significant supplier of high-end cheese and specialty dairy goods to the Chinese market.
Beijing’s latest action widens a series of trade measures targeting European agricultural and food products. Last week, China sharply reduced existing duties on pork and related by-products from the EU, setting new tariff bands between 4.9% and 19.8% across dozens of product lines. Earlier, in September 2024, Chinese authorities had imposed temporary anti-dumping deposits of up to 62.4% on EU pork. Those cash deposits were introduced while investigators examined allegations that European exporters were selling at below-market prices in China.
Trade friction has not been limited to food. In November 2024, the European Union filed a complaint at the World Trade Organization (WTO) challenging China’s provisional tariffs on EU brandy, arguing that the measures breach WTO rules. Documentation on that dispute is available on the WTO dispute settlement register.
Tensions escalated further after the European Commission imposed duties of up to 45% on battery-electric vehicles imported from China in October 2024. Brussels said those tariffs were necessary to offset what it described as unfair state support for Chinese carmakers. Beijing denies the allegation and has criticized the EU’s methodology.
Monday’s dairy announcement underscores how both sides continue to deploy trade remedies across multiple sectors. China’s Ministry of Commerce framed the dairy tariffs as a legitimate countervailing response to subsidized competition, while EU officials have previously insisted that their agricultural support programs comply with international rules.
Under WTO regulations, a government may impose countervailing duties if an investigation confirms that foreign subsidies materially injure a domestic industry. The duties must correspond to the level of the subsidization found. China’s published tariff schedule reflects that framework, assigning differentiated rates according to each exporter’s degree of cooperation and calculated subsidy level.
For European dairy companies, the new duties present a significant obstacle to serving the Chinese market, where premium cheeses and dairy products have gained popularity. Importers typically pass additional costs along the supply chain, potentially raising retail prices and dampening demand. Some exporters may shift focus to other Asian markets or seek to renegotiate distribution terms until the tariff issue is resolved.
China’s dairy sector has expanded rapidly over the past decade, supported by rising domestic consumption and state-backed initiatives to improve food security. Domestic producers argue that imported cheese and milk benefit from EU farm subsidies, creating an uneven playing field. By contrast, European industry groups maintain that their support mechanisms are permitted under WTO rules and are necessary to stabilize farm incomes.
Monday’s decision does not immediately indicate when—or if—negotiations might ease the dispute. Typically, such trade cases allow for consultations, judicial review through the WTO, or bilateral talks aimed at narrowing policy differences. In the meantime, importers must prepare to pay the additional duties once customs officials begin applying the new tariff schedule on April 23.
Crédito da imagem: Bertrand Guay | Afp | Getty Images
