The dairy sector remains confident about its competitiveness, despite the arrival of tariff-free US milk under a newly signed Taiwan-US trade agreement, industry and government representatives said yesterday.
Minister of Agriculture Chen Junne-jih (陳駿季) said in Taiwan’s milk market, where locally produced milk commands an 88.6 percent share, the US’ main competitor would be New Zealand.
Tariffs on New Zealand dairy products were removed in January last year under a bilateral free trade pact.
Photo: Taipei Times
Ministry of Agriculture data showed that Taiwan imported 239,153 tonnes of dairy products last year, of which New Zealand supplied nearly half at 119,972 tonnes.
The US ranked second with 47,118 tonnes, the data showed.
Chen said coordinated efforts between the government and industry have helped Taiwan withstand international competition.
Local dairy farmers are seeing improved profitability, supported by stable annual production of about 430,000 tonnes and steady improvements in quality, he said.
While imported milk generally has stronger price competitiveness, Chen said the law reserves the label “fresh milk” exclusively for domestically produced milk, a term strongly favored by consumers.
The ministry plans to prohibit imported milk from being labeled as fresh milk starting in July, he said.
Dairy Association of Taiwan secretary-general Fang Ching-chuan (方清泉) said US milk is unlikely to make major inroads into Taiwanese households, because it is typically sold in large containers, which do not suit Taiwan’s predominantly small households.
US exporters last year found that US milk has difficulty competing with New Zealand’s frozen concentrated milk, Fang said.
New Zealand’s frozen milk blocks cost NT$100 per liter and could be reconstituted to four times the volume, meaning the final cost is only NT$25 per liter, Fang said.
In contrast, US milk costs about NT$70 per liter and remains more expensive even with lower tariffs, Fang added.
Rather than focusing on price, the key issue is how to create value-added advantages, Taiwan Association of Chain and Franchise Promotion chairman Paul Wu (吳永強) said.
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