China extends anti-dumping probe into European brandy imports amid ongoing trade tensions with EU

China has extended its anti-dumping investigation into European brandy imports, including French cognac, until July 5. The announcement was made on Wednesday by the Chinese Ministry of Commerce, which cited the complexity of the case as the reason for the three-month extension. The investigation was originally scheduled to conclude on April 5.

The probe began in January following tensions between China and the European Union over trade practices. In particular, it is seen as a response to an EU investigation into Chinese subsidies for electric vehicles. In the fall of 2023, China introduced temporary anti-dumping measures on European brandy imports. These measures require importers to provide a financial guarantee, such as a bank deposit, when bringing brandy into China.

The French cognac industry has been directly affected by these measures. With 98% of its production destined for export markets, the sector is highly vulnerable to trade restrictions. China is the second-largest market for French cognac, accounting for 25% of exports, just behind the United States at 38%. According to industry representatives, the sector has been losing around €50 million per month since the temporary duties were introduced in November.

In response to these losses and growing concern among producers, the French government has been actively seeking a resolution. Last Friday, French Minister Delegate for Foreign Trade Jean-Noël Barrot announced from Shanghai that China had agreed to delay the implementation of final tariffs for three months. This postponement gives both sides more time to negotiate and potentially avoid a long-term trade conflict.

The Chinese Ministry of Commerce emphasized that the extension of the investigation does not imply any final decision yet. The outcome will depend on further analysis and consultations with stakeholders. Meanwhile, French officials continue to push for a diplomatic solution that would protect their national interests while maintaining stable trade relations with China.

The dispute highlights broader tensions between Beijing and Brussels over trade imbalances and industrial policy. While both sides have expressed willingness to engage in dialogue, no clear resolution has emerged so far. The European Commission has not yet commented on China's latest move but is expected to monitor developments closely.

For now, French cognac producers remain in a state of uncertainty. Many are adjusting their export strategies and exploring alternative markets while waiting for clarity on future access to China. The next few months will be critical in determining whether this trade dispute escalates or moves toward resolution through negotiation.