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%. The measures arrive as China’s dairy market faces structural contraction from demographic changes.
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 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. The timing suggests China is leveraging trade policy to address domestic market challenges.
Approximately 60 companies will face the new tariffs at varying rates. Arla Foods will pay between 28.6% and 29.7%. 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.
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, the world’s third-largest milk producer, faces long-term challenges as its population ages and shrinks. Last year, China imported $589 million in affected dairy products. Authorities urged producers to reduce output and older cattle.