European Dairy Tariffs Part of Broader China Retaliation Strategy

Chinese authorities have implemented provisional tariffs ranging from 21.9% to 42.7% on select European dairy imports effective Tuesday. Most companies will face duties near 30%. The measures follow an anti-subsidy investigation seen as part of Beijing’s broader retaliation strategy against EU trade policies.
Brussels has condemned the decision as unjustified and lacking proper foundation. The European Commission’s assessment indicates the investigation is based on questionable allegations without adequate evidence. Officials are conducting a detailed review and preparing formal objections.
Trade tensions erupted in 2023 when the European Commission launched an anti-subsidy investigation into Chinese-made electric vehicles. Beijing has imposed tariffs on imports of EU brandy, pork and now dairy, measures seen as retaliatory. However, as it did with pork, Beijing has reduced or limited the impact of its tariffs several times.
The tariff structure affects approximately 60 companies with differentiated rates. Arla Foods will pay between 28.6% and 29.7%. Sterilgarda Alimenti from Italy secured the most favorable rate at 21.9%, while FrieslandCampina’s Belgian and Dutch operations face the steepest penalties at 42.7%. Non-participating companies automatically receive maximum tariffs.
Chinese dairy producers are expected to benefit from these protective measures as they struggle with surplus production and declining profitability. Reduced birthrates and increasingly price-conscious consumers have dampened demand. China imported approximately $589 million in affected dairy products last year. The government has urged domestic producers to curtail production.