China to impose up to 42.7% provisional tariffs on EU dairy products

China will impose up to 42.7 per cent of provisional tariffs on dairy products, including milk and cheese imported from the European Union, its Commerce Ministry said on Monday.

The elevated duties, which take effect Tuesday, were based on preliminary results from an investigation opened by China's Commerce Ministry in August 2024 as tensions between Beijing and Brussels flared. Beijing reviewed subsidies provided by EU countries for their dairy and other farm products.

Beijing's probe was launched as part of tit-for-tat measures as the EU investigated Chinese subsidies on electric vehicles, and later imposed tariffs as high as 45.3 per cent on China-made EVs.

China had initiated other probes into European brandy and pork imports as countermeasures for the EU's tariffs on Chinese EVs. It had also urged the EU to scrap its EV tariffs.

The temporary duties on EU dairy imports will range from 21.9 per cent to 42.7 per cent, according to the Commerce Ministry, and will cover a basket of dairy products, including fresh and processed cheese, blue cheese, milk, and cream with a fat content exceeding 10 per cent by weight.

The ministry said preliminary findings from its investigation determined that subsidies provided by the EU and EU member states for their dairy products had damaged China's dairy industry.

Beijing's probe into EU dairy products covered subsidies given under the EU's Common Agricultural Policy and subsidies offered to farmers by EU countries, including Italy, Ireland and Finland, the Commerce Ministry said in August 2024.

China's relationship with the EU is fractious, with the Chinese trade surplus with the EU recently coming into the spotlight. The EU ran a significant trade deficit with China, at more than 300 billion euros ($352 billion) last year.

Last week, Beijing announced it was imposing up to 19.8 per cent tariffs on EU pork imports -- significantly lower than preliminary tariffs of up to 62.4 per cent.

It accused the EU of dumping pork and pig by-products in the country, selling them at low prices, which in turn harmed its domestic pork industry.

In July, Beijing also announced up to 34.9 per cent tariffs on brandy imported from the EU -- including cognac from France -- although several major brandy brands had received exemptions.