Thursday, 17 October 2019
By Felicity Rusk
From 18 October the United States will be applying retaliatory tariffs of 25% to a number of EU dairy products. However, the tariffs vary between EU member states. For the UK, the tariffs encompass nearly all butter and cheese exports to the US.
Here we look at how the tariffs will be applied to specific EU member states.
Cheese is the largest EU dairy export in both volume and value terms. Under the new tariff schedule, approximately 75% of EU cheese sent to the US will be subject to tariffs.
Italy is the largest exporter of cheese to the US. Last year, the nation accounted for almost a fifth of all cheese imported into the US. Italy have been included for all cheese tariffs, and so almost all (>99%) of Italian cheese exported to the US will be subject to the duties.
France is also a key exporter of cheese to the US, with 24,000 tonnes of cheese exported last year. France has been omitted from a selection of cheese tariffs, including Cheddar, Emmental and blue-veined cheeses. While the tariffs will still apply to around 96% of French cheese that is currently sent to the US, it will be interesting to see if the products exported will shift to those varieties that will not be subject to a tariff.
Butter is also a significant EU dairy export to the US. Ireland is the largest exporter of butter to the US, accounting for nearly half of all the butter imported into the nation last year. Under the new tariff schedule, all of Ireland’s butter exports will be subject to tariffs.
The implementation of the tariffs will make EU products more expensive, and in most cases uncompetitive on US markets. Exporters may have to choose between absorbing the tariffs into their costs or seeking alternative markets for their products.
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