China introduces a tax on milk powders from the US

In response to the import duties imposed by the United States (US) on Chinese goods, the country is taking countermeasures. For example, there will be an import tax on both whole and skimmed milk powder.

The Chinese tariffs are part of a package of countermeasures. The import duties are imposed on the US goods; it is worth about $34 billion. The measures will take effect from July 6.

A spokesman for the Chinese Ministry of Foreign Affairs says he regrets the measures, but sees no other options due to the rigid attitude of the US.

No major consequences
What is striking is that China does introduce a tax on whole and skimmed milk powder, but has not included other milk powder products (baby food and lactose) on the list. China may not want to block these trade flows. It remains to be seen whether the Chinese import tax will have a negative effect on American exports of milk powder.

In the Netherlands, the dairy exporters say that the Chinese import duties will probably not cause major shifts in the world market in the first place. According to data from the US Dairy Export Council, China was the fourth largest buyer of US dairy in 2017. In the first 4 months, the US shipped $203 million to China. This was $24 million more than in the same period a year earlier.

Wouter Job

Wouter Baan is editor-in-chief of Boerenbusiness. He also focuses on dairy, pig and meat markets. He also follows (business) developments within agribusiness and interviews CEOs and policymakers.

w.baan@boerenbusiness. Nl

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