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Beef to Taiwan

(Last updated: 31 Oct 2013)

Trends and opportunities

The market

Taiwan imports 96 per cent of beef for consumption purposes, owing to constraints in beef production capabilities. Australian beef is well received in Taiwan because of its ‘clean and green environmental image’ and high food safety standards. Taiwan’s beef imports come primarily from Australia, USA and New Zealand.

According to the Australian Bureau of Statistics, Taiwan imported approximately 38,653 tonnes of Australian beef in 2012 (6,403 tonnes of chilled beef and 32,250 tonnes of frozen beef) increases on 2011 volumes of 5 per cent and 6.2 per cent, respectively.

US beef imports dropped to 14,170 tonnes in 2012, declining 52 per cent from the previous year due to the Taiwanese government’s ban on beef containing the leanness-enhancing drug ractopamine. After new regulation allowing imported beef containing set levels of ractopamine took effect on September 11, 2012, the import of US beef showed significant growth. US beef imports increased 130 per cent from 8,438 tonnes to 19,385 tonnes during January to June 2013, in comparison with the same period last year.

Australian beef imports to Taiwan were stable, with 21,147 tonnes from January to June 2013 – comparable with the same period in 2012.

Traditionally, Taiwan consumers prefer US beef over Australian beef, considering it to be of higher grade. Cuts of tenderloin, rib eye, striploin and short rib have been imported from the US. In recent years, Australia has started to promote its high value and quality beef (instead of the traditional cuts – shin shank and intercostal) such as grain-feed beef and pure blood wagyu beef. By raising the profile of Australian beef and increasing Australia’s market share, it is expected that consumer attitudes will change over time.

Beef from the US is considered of higher quality, and is classified as ‘special grade’ for tariff purpose, whereas Australian and New Zealand beef and domestically produced beef are classified as ‘general grade’. The quality of beef determines where the products are sold. For example, US and New Zealand beef tends to go to the Western-style restaurants and modern supermarkets. On the other hand, Australian beef (mostly shin shank and other lower value cuts) are used mainly in Chinese restaurants and local wet markets for predominantly local dishes, in particular ‘beef noodles’.

Taiwan and New Zealand signed an Economic Cooperation Agreement (ECA) on 10 July 2013. Under the Agreement, the tariff rate of New Zealand beef exports to Taiwan will be reduced significantly from the first year and reduced to zero from the second year of the agreement. According to local meat industry contacts, Australia’s beef exports to Taiwan might be affected by the competitive advantage New Zealand producers will enjoy from the ECA. For more information about the ECA and tariff rates changes, please visit the Ministry of Economic Affairs’ website.

(Source: Directorate General of Customs, Executive Yuan, R.O.C., 2012)

Taiwan beef imports, percentage market share by country of origin

Taiwan beef imports, percentage market share by country of origin

(Source: Directorate General of Customs, Executive Yuan, R.O.C., 2012)

Opportunities

Along with New Zealand, Australian beef is at an advantage for being unaffected by bovine spongiform encephalopathy (BSE, or mad cow disease) and other food safety issues.

From Australia, the most popular and stable cuts in terms of demand are shin shank, knuckle, chuck tender and intercostal.

Due to the strong demand of shin shank and intercostal cuts from other markets, it is suggested that the Australian meat industry consider introducing alternative cuts to replace shin shank and intercostal.

Competitive environment

Australia is the largest supplier of beef to Taiwan, followed by the US and New Zealand. Australian beef has also traditionally been cheaper than New Zealand and USA beef, and its market share, import quantity and price are more stable than other suppliers.

With a trade agreement between New Zealand and the Separate Customs Territory of Taiwan (ANZTEC) signed in July 2013, a majority of the beef products from New Zealand will enjoy zero tariffs upon ANZTEC’s entering into force in 2014. Accordingly, Australian beef products are expected to face more serious challenges from New Zealand exporters in the future.

Tariffs, regulations and customs

Industry standards

Taiwan's Ministry of Health and Welfare (MHW) is responsible for managing food safety and all associated laws, regulations and standards. All imported food items are inspected at the point of entry in Taiwan by the Ministry of Economic Affairs' Bureau of Standards, Metrology and Inspection, on behalf of the MHW.

In addition, the MHW commissions the Bureau of Animal and Plant Health Inspection and Quarantine of the Council of Agriculture to inspect all fresh fish and seafood products, including aquatic plants.

Processed foods are inspected for correct labelling, food hygiene and food additives. The importation of food additives is prohibited without prior authorisation from the MHW. A complete list of applicable standards and regulations can be purchased in Mandarin Chinese, directly from the MHW.

Marketing your products and services

Market entry

Although Australian beef is well received and established in Taiwan, exporters need to develop long-term strategies to create greater demand in the market. This could include:

  • Increasing the market penetration of Australian beef in the retail and food service sectors by introducing new beef cuts to match specific Chinese food preparation techniques.
  • Operating/marketing environment and trade/distribution issues, due to shrinking beef sales margins, retailers and food service operators and are reluctant to make significant investment in promoting Australian beef. Therefore, an ongoing marketing plan is essential in maintaining the market share.
  • Continuing to raise the profile of Australian beef by highlighting quality, nutrition and health advantages is also a priority to help drive overall beef consumption. Exporters can utilise public relations and advertising to promote Australia’s beef image.

Distribution channels

Taiwanese retailers use a variety of different methods to purchase products including direct sales, distributors, wholesalers, agents and representatives.

The hotel and restaurant industry primarily relies on importers, distributors, wholesalers, wet markets and retailers for imported food supplies. Some independent small-sized establishments have begun making volume purchases of imported goods at local hypermarkets in order to avoid the hassle of more traditional import channels. Institutional players, meanwhile, are reliant on importers and distributors for the most part, but may also source products directly from foreign producers.

In the hotel segment, food purchase decisions are usually made by food and beverage managers or the respective executive chefs. Hotels that serve western food or employ western chefs are subsequently more likely to require imported food products on a regular basis, commonly sourcing through distributors and wholesalers.

Fast-food and family-style restaurant chains frequently maintain their own distribution centres, which manage purchases and supplies for the entire chain, island-wide. In addition, some chain restaurants will prepare meals at a central location and distribute the meals to their various locations around Taiwan. Smaller eateries most commonly source their food supplies from traditional or wet markets.

Agents and representatives have the advantage of superior market intelligence and improved communication for customer service. Sales representatives play an important role in the direct sale of products. Generally speaking, foreign firms are better served by local agents with whom they have close ties.

Links and industry contacts

Beef-related resources

Bureau of Animal and Plant Health Inspection and Quarantine – www.baphiq.gov.tw
Council of Agriculture – http://eng.coa.gov.tw/
Ministry of Health and Welfare – www.mohw.gov.tw/EN/Ministry/Index.aspx
Ministry of Economic Affairs – www.moea.gov.tw

Contact details

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