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China has launched an anti-dumping investigation into imported European dairy merchandise, within the newest escalation of a commerce dispute with the EU.
The investigation comes a day after the European Fee revealed a collection of further levies on Chinese language electrical car imports, regardless of opposition from Beijing.
The Chinese language commerce ministry mentioned on Wednesday that its probe into EU dairy imports was prompted by complaints from home producers over European subsidies. In keeping with an announcement, the investigation will cowl “certain products” together with lotions and cheeses.
The transfer marked Beijing’s strongest retaliation but in opposition to Brussels’ EV tariffs. China has already opened anti-dumping probes into French cognac and EU pork imports and has lodged a criticism on the World Commerce Group.
The bloc’s chief diplomat, Josep Borrell, mentioned at an occasion in Spain this week that the EU “mustn’t be naive” however {that a} commerce warfare was “maybe . . . unavoidable”.
The European Fee mentioned that Brussels “takes note” of China’s resolution to launch an anti-subsidy probe into sure dairy merchandise and would analyse the process “very closely”.
“The commission will firmly defend the interests of the EU dairy industry . . . and intervene as appropriate to ensure that the investigation fully complies with relevant WTO rules,” it mentioned.
The European Union Chamber of Commerce in China mentioned Beijing’s motion “should not be considered a surprise”.
“Regrettably, the use of trade defence instruments by one government is increasingly being responded to seemingly in kind by the recipient government,” the chamber mentioned, including that it hoped the investigation would “be conducted fairly and transparently”.
European dairy exports to China had been valued at about €1.8bn final yr, down from €2bn the yr earlier than, in keeping with European Fee commerce information, and accounted for about 9.5 per cent of the EU’s whole dairy exports.
The Chinese language dairy business our bodies claimed that imported EU dairy merchandise had benefited from a complete of 20 subsidy programmes. Germany is the bloc’s largest producer of milk, butter and cheese, adopted by France.
The market share of imports in China’s toddler formulation market, the place competitors has elevated and laws have been tightened, fell from 51 per cent in 2019 to 44 per cent in 2023, in keeping with Dutch financial institution Rabobank.
China’s declining delivery fee has additionally pressured home and international firms to push into new merchandise within the nation, akin to these focusing on older shoppers.
Imports of milk powder and fluid milk have additionally fallen this yr due to greater home manufacturing, in keeping with estimates from the US Division of Agriculture in Might.
“Growth in raw milk production continues to outpace consumption, creating an oversupply in the Chinese market,” the report mentioned.
Extra reporting by Gloria Li in Hong Kong
