China has escalated its trade tensions with the EU by launching an investigation into subsidies for European dairy products, following its ongoing dispute over EU tariffs on Chinese electric vehicles, which are already under WTO review. This new probe, reminiscent of a similar investigation into pork meat announced two months ago, will scrutinize 20 subsidy programs, including those under the EU’s Common Agricultural Policy and additional schemes in Austria, Belgium, Croatia, the Czech Republic, Finland, Italy, Ireland, and Romania. The inquiry, which could lead to new tariffs, is expected to conclude within a year but may be extended by another six months. The European Commission has vowed to “vigorously defend the interests of the EU dairy sector.”
EU DAIRY EXPORTS TO CHINA
The EU remains the second-largest cheese supplier to China, with a 36% market share, trailing only New Zealand. According to Eurostat data cited by Il Sole 24 Ore, the EU exported €1.7 billion worth of dairy products to China last year, down from €2 billion in 2022, accounting for 9.5% of total EU dairy exports.