China has initiated a probe into subsidies concerning dairy imports from the European Union, a move interpreted as yet another escalation in an ongoing trade conflict. This investigation announcement follows the EU’s recent imposition of additional tariffs on Chinese electric vehicle imports.
Already, tensions have led to China launching an anti-dumping investigation targeting specific pork and pig by-products sourced from the EU, covering the period from January 1, 2023, to December 31, 2023. The term ‘dumping’ refers to the practice of selling goods in an importing country at a price significantly lower than in the producing nation.
On August 21, a report from China’s state news agency, Xinhua, indicated that the Ministry of Commerce is now focusing its investigations on select dairy products imported from the EU. Notably, China comprised around 9.5% of total European dairy exports last year.
According to Xinhua, the investigation was prompted by an application from the Dairy Association of China and the China Dairy Industry Association, which was submitted in July on behalf of the domestic industry. The ministry requested consultations with the EU regarding the probe on August 7, with discussions taking place a week later.
The investigation will scrutinize specific dairy imports from the EU, including fresh cheese, curd, and blue cheese, over the timeframe from April 1, 2023, to March 31, 2024. Furthermore, any harm incurred by related Chinese industries from January 1, 2020, to March 31, 2024, will also be assessed.
The probe will evaluate 20 EU subsidies, including those from the bloc’s Common Agricultural Policy (CAP) and various national subsidy programs from countries like Ireland, Austria, Belgium, and Italy. This investigation is expected to conclude by August 21 but could be extended for up to six months under special circumstances, mirroring the timeline established for the pork inquiry.
In response to a query from Just Food, European Commission spokesperson Olof Gill stated, “The Commission acknowledges China’s decision to initiate an anti-subsidy investigation on imports of certain dairy products from the EU.” He added that the Commission will closely monitor the situation, collaborating with EU industries and member states, and will defend EU dairy interests and the CAP in accordance with World Trade Organization rules.
Alexander Anton, the Secretary General of the European Dairy Association, remarked that Chinese authorities have commenced consultations in response to complaints from the Chinese dairy sector regarding EU subsidy programs, primarily facilitated through the CAP. He expressed confidence in the WTO compliance of the overall CAP framework for EU agricultural support and indicated a commitment to working with both EU services and Chinese counterparts to clarify issues related to dairy trade.
Anton emphasized, “We trust that the EU and China will find a constructive way to resolve any bilateral disputes, as has occurred previously over different matters.”
Understanding such dynamics is crucial for stakeholders in the food and beverage industry, particularly in navigating the complexities of international trade and its implications for consumer trends. Sign up for our newsletter to stay informed on the latest developments that impact the food and drink business and keep abreast of evolving consumer trends.
