China says to impose 55% levy on Australian beef after quota hit

China said on Friday it will impose a tariff of 55 percent on beef imports from Australia after shipments from the country hit Beijing’s annual limit.

The price of beef in China has trended downwards in recent years, with analysts blaming oversupply and a lack of demand as the world’s second-largest economy has slowed.

At the same time imports have surged, with China representing a hugely important market for countries such as Australia.

Beijing’s Commerce Ministry assigned annual quotas on beef from countries including Australia in late December after investigators found that imports had damaged China’s domestic industry.

Beef sent to China would be subject to the extra 55 percent levy if imports went beyond those quotas, the ministry warned, with Australia facing a quota of 205,000 tons in 2026.

The Commerce Ministry said on Friday that “imports of beef from Australia under the beef safeguard measure reached 100 percent of the prescribed volume for that country” a day earlier.

The additional 55 percent tariff would be levied on Australian beef imports from Saturday, it said.

The ministry described the levies in December as “safeguards” and said they would be gradually relaxed.

Australia’s government said in January it was “disappointed” with China’s decision to impose the new beef import tariffs, with one industry group warning the move could damage trade worth over AU$1 billion ($701.5 million) between the two countries.