China is one of the world’s largest consumer markets, and any adjustments to its import and export tariffs can have immense impacts on global trade.
The local State Council Customs Tariff Commission recently announced that adjustments had been made to its import-export tariffs for 2025, affecting some 8960 tax items.
Whilst most staple food items such as wheat and sugar will not see major changes, several food and beverage related products are expected to see significant impacts as a result of these changes.
“China is making these adjustments in order to improve management of local tariffs and support the development of modern innovation and production so as to accelerate trade and promote national modernisation,” the commission stated via a formal statement.
“In accordance with this, import tariffs and taxation of several commodities have been adjusted from January 1 2025.
“Amongst these are various dairy products such as processed cheeses and whey – the former will enjoy a provisional tariff rate of 8% in 2025 (compared to 12% Most Favoured Nation tariff rates for powdered cheeses and 15% rates for blue cheese and other mould-processed premium cheeses) and the latter will enjoy a 2% provisional rate (compared to a 6% Most-Favoured Nation rate).”
Most Favoured Nation or MFN tariff rates are the lowest tariffs a country can charge on imports from other World Trade Organisation (WTO) member nations unless there are other preferential trade agreements in place.
In China, provisional import tariff rates are even lower rates than MFN tariffs put on certain imports, and preferential tariff rates are provided to several least-developed countries that have diplomatic relations with China.
Other dairy products set to enjoy better provisional rates include retail packaged infant formula that is not for special medical purposes (5% provisional rate vs 15% MFN rate), whereas milk-based foods for infants and general consumers that are meant for special medical purposes will enjoy 0% tariffs.
Sugar to take a hit
Conversely, China will be increasing its tariff rates for certain syrups and premix powders that have a high sugar content.
“China will be increasing import tariffs on commodities such as syrups and sugar-containing premixed powders – both will see an increase in MFN tariff rates to 20% in 2025, compared to the previous MFN rate of 12%,” said the council.
“This has been implemented in accordance with the development of domestic industries and changes in supply and demand, as well as to act within the scope of China’s commitment to joining the WTO.”
Although not specifically stated, higher tariffs on these commodities will have clear impacts on areas such as sugary beverage production, hence impacts on the costs of these items are expected to also impact the prices of products with such high sugar content, affecting consumer purchasing in the long run.
