Taiwan's dairy industry confident against U.S. milk import competition

Taipei, Feb. 14 (CNA) Taiwan's dairy sector remains confident about its competitiveness despite the arrival of tariff‑free U.S. liquid milk under a newly signed Taiwan-U.S. trade agreement, industry and government representatives said.

Speaking to reporters on Saturday, Agriculture Minister Chen Junne‑jih (陳駿季) said that in Taiwan's liquid milk market, where locally produced milk commands an 88.6 percent share, the United States' main competitor will be New Zealand. Tariffs on New Zealand dairy products were removed in January 2025 under a bilateral free trade pact between Taipei and Wellington.

Ministry of Agriculture (MOA) data showed Taiwan imported 239,153 tons of dairy products in 2025, of which New Zealand supplied 119,972 tons, nearly half. The U.S. ranked second with 47,118 tons.

Chen said coordinated efforts between the government and industry have helped Taiwan withstand international competition. Local dairy farmers are currently seeing improved profitability, supported by stable annual production of about 430,000 tons and steady improvements in quality.

While imported milk generally has stronger price competitiveness, Chen noted that Taiwanese law reserves the label "fresh milk" exclusively for domestically produced milk, a term strongly favored by consumers. The MOA plans to prohibit imported milk from being labeled as fresh milk starting in July, Chen said.

Dairy Association of Taiwan secretary‑general Fang Ching‑chuan (方清泉) told CNA that U.S. liquid milk is unlikely to make major inroads into Taiwanese households because it is typically sold in large, nearly two‑liter containers -- formats that do not suit Taiwan's predominantly small households.

Regarding U.S.-New Zealand competition, Fang said American exporters visited Taiwan last year and found that U.S. liquid milk has difficulty competing with New Zealand's frozen concentrated milk.

New Zealand's frozen milk blocks cost NT$100 per liter and can be reconstituted to four times the volume, meaning the final cost is only NT$25 per liter. By contrast, U.S. liquid milk costs around NT$70 per liter and remains more expensive even with lower tariffs, Fang said.

Rather than focusing on price as U.S. liquid milk enters Taiwan with zero tariffs, the key issue is how to create value-added advantages, said Paul Wu (吳永強), chairman of the Taiwan Association of Chain and Franchise Promotion.

"Taiwan's fresh milk has a major strength: it takes only 24 hours to go from farm to table." Wu said.