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The Irish dairy industry is set to be caught in a brewing trade row between the European Union and China. Chinese authorities announced overnight that they have have opened an anti-subsidy investigation into imported dairy products from the EU. The move appears to be a tit-for-tat response to a move by the EU to restrict electric vehicles from China.
A move to restrict EU dairy would mainly hit Ireland but the EU’s announcement this week of tariffs on imports of electric vehicle from China, which would mainly benefit Germany and other car makers..
China is a significant, if challenging market for Irish dairy which includes supplying the countries huge baby formula sector. The move comes just ahead of a planned trade mission by Irish ministers and officials to China next week.
The new investigation announced by China’s commerce ministry on Wednesday will focus on various types of cheeses, milks and creams intended for human consumption.
The probe began was prompted by a complaint submitted by the Dairy Association of China and the China Dairy Industry Association on July 29 on behalf of the domestic dairy industry, the ministry said. In 2022 Irish agri-food exports to China were valued at €722m, mostly food and drink. Irish dairy sales to China last year were worth around €400m.
China will examine 20 subsidy schemes from EU members Austria, Belgium, Croatia, Czech Republic, Finland, Italy, Ireland, and Romania, it said in a statement.
Of the countries listed, Ireland is by far the biggest exporter of dairy to China.
The move by China comes in the wake of the EU on Tuesday announcing scaled down but still significant duties on imports of Chinese-made electric vehicles that Beijing had called on Brussels to scrap.