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(Last updated: 15 Sept 2008)
Trends and opportunities
The market
In 2007, the Taiwan dairy market value reached a healthy US$1.4 billion with a growth rate of 3.2 per cent during the years 2003-2007. According to the Council of Agriculture, in 2007, the total dairy import volume also stood at 147,004 tonnes, with a value of US$378.3 million (A$459.6 million). This showed a -4.9 per cent growth in volume and a 0.7 per cent increase in value compared to 2006.
In terms of value share of the total dairy market, drinking yoghurt and yoghurt has the greatest share with milk following in second place. As far as the origin of dairy products in Taiwan, locally produced raw milk is used mainly for fresh milk and drinking yoghurt production, whereas milk powder, cheese and butter is predominantly imported.
In regards to imported goods, the largest supplier of dairy products to Taiwan is New Zealand. In 2007 it represented 42 per cent of the market share, an increase of three per cent on the previous year.
The second largest export country was Australia, which accounted for 18 per cent of the market share, a five per cent down turn from 2006. Australian dairy exports to Taiwan in 2007 were 24,550 tonnes showing a decline of 26 per cent from 2006. The shortage of Australian dairy products had a strong impact on pricing and demand, and caused a chain reaction in the dairy supply in Taiwan.
The third largest dairy export country was Asian giant China. Its export volume stood at 15,977 tonnes demonstrating a remarkable 30 per cent increase from the previous year.
Due to the significant decrease of Australian products, China’s volume share increased to 11 per cent, consisting mainly of milk powder. France became the fourth largest supplier with a five per cent of volume share in 2007 and the USA’s share dropped 43 per cent and ranked sixth due to the insufficient supply of whey powder.
Opportunities
The demand for Australian dairy products is always high in Taiwan, and the following items offer good potential for Australian exporters:
- UHT milk
- cheese
- milk powder
- butter
Competitive environment
Australian dairy products are high profile in Taiwan, and local consumers have confidence in their quality. However, New Zealand products also have a good image and are competitive in price making them Australia’s biggest competitor.
For the past two years, the US has also started to promote its cheese to the market. Even though its quantity is still relatively small in comparison to Australia and New Zealand, its growth is fast, and is good to be aware of.
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Tariffs, regulations and customs
The Taiwanese Government has temporarily halved the tariffs on milk powder products for six months starting from 16 May to 15 Nov 2008.
The temporary reduced tariff rates of milk powder are:
| 04021090 |
SMP: 5% |
| 04022190 |
WMP: 5% |
| 19011000 |
Infant milk powder: 2.5% |
| 19019021 |
Prepared milk powder: 6% |
| 19019022 |
Other milk powder: 6% |
Other dairy product tariffs
| 04061000 |
Fresh cheese, including whey, cheese and curd: 5% |
| 04062000 |
Grated or powdered cheese, of all kind: 5% |
| 04063000 |
Processed cheese, not grated or powdered: 5% |
| 04064000 |
Blue-veined cheese: 5% |
| 04069000 |
Other cheese: 5% |
| 04011090 |
Cream and other milk, not concentrated and unsweetened, of a fat content, by weight, not exceeding 1%: 20% |
| 04012090 |
Cream and other milk, not concentrated and unsweetened, of a fat content, by weight, exceeding 1% and less than 6%: 20% |
| 04013090 |
Cream and other milk, not concentrated and unsweetened, of a fat content, by weight, exceeding 6%: 20% |
| 04041090 |
Whey and modified whey, not concentrated or concentrated, whether or not containing added sugar or other sweetening matter: 5% |
| 04012010 |
Fresh milk (excluding raw milk and milk of goat and sheep), not
concentrated and unsweetened, of a fat content, by weight, not exceeding 1%: NT$15.6/KGM (TRQ) |
| 04012020 |
Long-life milk (excluding raw milk and milk of goat and sheep), not
concentrated and unsweetened, of a fat content, by weight, exceeding 1% but not exceeding 6%: NT$15.6/KGM (TRQ) |
Note: Tariff Rate Quota (TRQ) means that the product is permitted under a normal tariff up to a certain annual quota volume, at which point a ‘prohibitive’ tariff is given on any additional imported quantities.
For the most up-to-date tariffs visit www.customs.gov.tw
Industry standards
Australian exporters need to meet the Food Sanitary Standards defined by the Department of Health.
Australian exporters also need to meet Taiwan’s nutrition labelling regulation.
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Marketing your products and services
Market entry
Australian dairy suppliers should have a well-planned marketing strategy and provide an assurance of quality in order to build a solid reputation with buyers. This is fundamental to taking advantage of the diverse range of opportunities available in this market and will assist companies to:
- Assess current demand for the product or service in Taiwan.
- Identify levels of local production and imports of the product.
- Identify major players in the market and potential agents and distributors.
- Understand the regulatory processes, import tariffs and trading regime relevant to the product or service.
- Identify competing products or services in the market and the organisations servicing this competition.
Taiwan buyers remain extremely price-conscious, and have a preference for stable and well-proven products, turn-key solutions, and a strong reliance and expectation on the supplier to provide after-sales service support.
It is also important to be aware of significant cultural differences in Taiwan. As well as having a general understanding of the historical and cultural background of Taiwan, you need to understand and practice the more day-to-day business culture if you are to foster alliances.
Australian dairy is well known and well regarded in the Taiwan market and has an image of being consistently of high quality, healthy and natural. To export successfully in Taiwan, you need to consider:
- Developing a good marketing plan with a long-term vision.
- Providing high-quality and consistent produce.
- Establishing strong relationships with supermarkets and importers with good distribution channels.
- Visiting Taiwan frequently to support your agent and participate in trouble-shooting in a pro-active fashion.
- Following up on issues raised in your visits.
- Participating in the Taipei International Food Show to enhance the profile and image of your products.
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Contact details
The Australian Trade Commission (Austrade) is the Australian Government’s trade and investment development agency, operating as a statutory agency within the Foreign Affairs and Trade portfolio.
Austrade assists Australian businesses contribute to national prosperity by succeeding in trade and investment, internationally, and promoting and supporting productive foreign investment into Australia.
Austrade:
- Delivers services that assist Australian businesses initiate, sustain and grow trade and outward investment.
- Promotes Australia as an inward investment destination and, with the States and Territories, supports the inflow of productive foreign direct investment.
- Administers the Export Market Development Grants scheme.
- Undertakes initiatives designed to improve community awareness of, and commitment to, international trade and investment.
- Provides advice to the Australian Government on its trade and investment development activities.
- Delivers consular, passport and other government services in designated overseas locations.
A list of Austrade offices (in alphabetical order of country) is available.
More information
For further information please contact Austrade on 13 28 78 or email info@austrade.gov.au |
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