China is targeting three major European slaughterhouses, including Vion. They are accused of dumping cheap pork on the Chinese market. This measure is not an isolated measure, but appears to be a retaliation for European import duties on cheap electric cars from China. The erupting political feud is visibly intensifying and could last a long time. The Dutch pig sector is convinced that China is wrong. But in this case, being right is probably something different from actually getting it.
The fact that China is now aiming directly at Vion, Danish Crown and the Spanish Litera means that man and horse are being appointed directly. Previously, China focused on the European pig sector as a whole. You would actually expect Tönnies to be on this list, but the German pig sector is still struggling with an export ban in China. The most famous pig slaughterer in Europe is therefore no match. Initially, China also threatened a boycott of European milk powder, but for the time being pork seems to have to absorb the blow.
Not chosen at random
The Chinese investigation into dumping of European pork (and also milk powder) was not chosen at random. China exports many more raw materials to Europe than the other way around, but they do import large volumes of these. However, at the moment, China's import needs are not that great. The rapidly growing production of milk and pigs has even created surpluses in the Asian country, putting pressure on prices. A fortunate coincidence for the European pig sector is that they rely much less on sales in China than, for example, a few years ago. Nevertheless, the trade issues do create a tense atmosphere on the pig market. It can be seen as one of the causes of the recent price fall. After all, access to the Chinese market is and remains of great importance for the sale of by-products.
Reactions POV and COV different in tone
It is therefore not surprising that advocates in the pork sector responded after the news. Both POV and COV made themselves heard, but surprisingly enough, the two responses are not entirely consistent with each other. For example, the POV recognizes that the dumping investigation is actually a politically driven instrument. The COV does not say a word about this and only says that it is confident that the Chinese investigation will show that there are no dumping practices. Vion itself did not make a statement and joins the COV. It is understandable that the meat sector expects a good outcome. An overly angry attitude does not help your position in advance. But as the POV's response shows, the question in this politically complicated case is whether being right is the same as being right.
In an intermediate phase
At the beginning of this month, the European Union indicated that import duties on Chinese electric cars would continue for four months. If it turns out that Chinese automakers still benefit from government subsidies according to Brussels findings, the measures will remain in force for five years. The conflict has now entered an intermediate phase, where it could in principle go either way. However, if the European import duties become definitive at the end of 2024, this will of course be against China. The results of the dumping investigation are then easy to guess.
For the time being, the dumping investigation appears to be a Chinese joker to counteract. The only question is whether they are impressed by this in Brussels. The interests of the European car industry are enormous and are probably protected tooth and nail. Whether the export interests of the pig and dairy sectors outweigh this remains to be seen.