October 18, 2017

U.S. Milk Exports to Taiwan Could Set New Record

 |  By: Anna-Lisa Laca

It’s increasingly critical that U.S. dairy farmers are aware of the world market. In America today, one day’s worth of milk produced on farms each week is sold to another country. One country of growing importance to U.S. export markets is Taiwan. According to USDA’s Foreign Agricultural Service (FAS) office, U.S. fresh milk exports to Taiwan are on track to reach a new record this year. According to a report released by the agency on Wednesday, exports for the first eight months of 2017 reached 19,015 tons, up 34% from the same period last year. While milk consumption and imports are expected to remain stable for the rest of 2017 and into 2018, growth potential is not unlimited on the island country.

High out-of-quota tariffs (TRQ) and “a special safeguard mechanism” (SSG) limit total imports to protect Taiwan’s domestic dairy industry, according to FAS.

“The TRQ and SSG effectively cap overall imports, and fluid milk imports in 2017 and 2018 are forecast to remain flat at 50,000 tons,” the report says. “Imports for the first eight months of 2017 surged to 37,034 tons, up 25% from the same period last year. Strong demand and competitive prices caused the quota to fill early.”

Their most recent spotlight on Taiwan, USDA describes the country as a small but stable producer of fluid milk. Domestic production there accounts for 90% of the total fluid milk supply. The U.S. is currently the top exporter of milk to Taiwan, followed closely by New Zealand and Australia.

Another bright spot for the U.S. dairy industry in Taiwan is cheese. Taiwan doesn’t commercially produce any cheese. According to the U.S. Dairy Export Council (USDEC), Taiwan cheese imports grew 8% year-over-year, to another record high of 31,704 metric tons in 2016. The U.S. has 22% market share in the Taiwan cheese market. Cheese consumption in Taiwan is low compared to Western countries and Japan, but as local chefs and consumers learn about the variety of U.S. cheese products and how they can be incorporated into local cuisines, USDEC anticipates opportunity for products like cream cheese, mozzarella, and cheddar.