The success of dairy companies Fonterra and A2 is largely underpinned by exports to China. Trends emerging Shipments to the region grew by nearly 100,000 tonnes last year over 2017 thanks to strong orders for whey ingredients, milk powder and cheese, which all reached new all-time records. 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The SSG was triggered on red meat exports to China in July, representing record sales for the sector. This 41-page publication is a step-by-step guide of all the stages a company has to go through when exporting dairy to China, including links to all the most relevant standards and regulations. It is clear that U.S. dairy exporters to China have significant opportunities in the short term and the time is now to take advantage of this growing market. Published 30 November 2018 Last updated 29 September 2020 — see all updates It may surprise you, but the last time we had a global recession (2009), global milk-equivalent imports were up more than 10% from 2008. U.S. dairy export volume in milk solids equivalent (MSE) rose 5% in September, marking the 13th straight month of year-over-year increases. These issues will only be exacerbated if the United States pursues a strategy of economic “decoupling” from China, meaning separating the world’s two largest economies. “The demand is evident around the world for high-quality, safe, affordable U.S. dairy products. Dairy: Kiwi companies sold $4b worth of dairy products in China. U.S. dairy exports grew rapidly between 2009 and 2013, led by nonfat dry milk and whey. The one bright light in recent years was exports, particularly to China, says Tom Vilsack, the head of the U.S. United States dairy farmers are warning that the country’s trade war with China is hurting the sector. 3. Dairy exports to Asia Greater China (including China, Hong Kong and Macau) is Australia’s largest dairy export market, accounting for 30% of exports by volume. Dairy exports to China rebounded in May, with the nation seizing the second spot in U.S. dairy export destinations. Policy. The Chinese are importing dairy cattle, bull semen and processing infrastructure as they continue to grow and develop. The latest data shows milk exports are up 14% in value compared to the same time last year. Charities slammed by triple threat as coronavirus damage takes its toll, Vegans rising: Australia second in the world for veganism as Gen Z snubs lab-grown meat, Industry super funds to invest $33 billion in job creation, Victorian real estate agents push back against calls to block rent reductions, Call for diversity as Aussie model with disability prepares for catwalk at New York Fashion Week, interim tariff could be placed on Australian wine, investigation into claims the Australian industry was subsidised, and its winemakers sold wine to China below the cost of production. As part of its plans, China’s provincial-level governments are offering incentives for expanded capacity in Chinese swine farms, creating targets for China’s swine inventory to reach not only pre-ASF levels, but eventually to exceed them. Australian dairy exports to China have grown to be worth more than $1 billion a year, and so far the industry remains unaffected by souring trade tensions between the two nations. U.S. export volumes of SMP/NDM topped 700,000 tons for the second straight year in 2019. The Chinese are looking for Holstein Friesian heifers that are strong, versatile, and that can thrive in moderate climates. Politics has added yet another challenge. Australian dairy exports to China have grown to be worth more than $1 billion a year, and so far the industry remains unaffected by souring trade tensions between the two nations. The guide starts with an introduction to the dairy sector introducing the major driving forces in this market. With greater self-reliance in producing whey for animal feed in China, the Chinese government may reinstate tariffs on U.S. whey and discourage Chinese swine operators from importing it. In fact, China’s self-sufficiency in milk production declined over the past years as consumers turned to dairy imports. With the strong demand for fluid milk among Chinese consumers, the need to increase imports, the removal of regulatory barriers on U.S. dairy, and the Chinese consumer’s favoritism of imported dairy products due to historic food safety crises like melamine, U.S. fluid milk is well positioned to grow in the near term before China’s domestic production reaches capacity to meet domestic demand. In retaliation for increased tariffs from the United States, China placed tariffs on a number of U.S. agricultural exports. Cheese exports increased for the third straight year, up 3%. Above and beyond whey and fluid milk opportunities in the next year, USDA also predicts cheese and butter imports will continue to increase due to strong demand from the Chinese foodservice and bakery sectors as Western foods grow in popularity. It may surprise you, but the last time we had a global recession (2009), global milk-equivalent imports were up more than 10% from 2008. You owe Mummy a tea set, Artificial intelligence is the latest weapon in hospitality wage-theft war, Michael Pascoe: Federal government pocketing interest on states’ debt, Should kids be first or last in line for a COVID vaccine? Get The New Daily free every morning and evening. (Xinhua/Chen Xu) Dairy Export Council. Australian dairy exports to China have grown to be worth more than $1 billion a year, and so far the industry remains unaffected by souring trade tensions between the two nations. Kirstie Clements: Misseltoe the line, boys. In 2019, approximately 35 per cent of Australian dairy exports went to China, with 30 per cent to Southeast Asia. Fresh milk exports to China have picked up after a COVID-19 slump Australia's biggest macadamia exporter says China can be a volatile market, and has made sure they can divert their product elsewhere And how will this one finish? The Chinese are importing dairy cattle, bull semen and processing infrastructure as they continue to grow and develop. If the U.S. industry waits too long to engage, even more market share may be lost to competitors like the European Union, or if the Chinese government has its way, Chinese suppliers themselves. An import value of almost EUR 4 billion and an average annual growth rate of approximately 45% during the period from 2009 to 2013 constitute a solid base from which to continue growth in both value and variety. Value basis: September export value rose 1.7% to $517.8 million. Shaping September’s export growth were strong year-over-year sales of whey products, primarily destined for China, and better-than-expected cheese exports to Asia-Pacific markets. Becky Rasdall, Vice President, Trade Policy and International Affairs, IDFA Becky Rasdall joined the... Today the U.S. Department of Agriculture released July 2020 agricultural export data through the For... Read the latest issue of The Dairy Bar, a bi-weekly report from IDFA partner Blimling and Associates... Register for Dairy Forum 2021 today to take advantage of great rates starting at just $795! It would be the first time the safeguard has been triggered since ChAFTA was signed in 2015. Subscribe for free to get the latest breaking news and analysis sent to your inbox. At +318%, it was a significant month-to-month surge that could be a signal of an increase in U.S. whey market share thanks in part to the Phase I trade agreement. The registration with the AQSIQ is mandatory for manufacturers of dairy products. Over the first five months of the year, the value of U.S. dairy exports is 12 percent ahead of the same period as last year, while volume growth is tracking 10 percent ahead of the same period. It comes as Victorian timber exports to China have been stopped and winemakers prepare for the possibility an interim tariff could be placed on Australian wine, while China investigates dumping and countervailing claims. After signing a $20m milk export contract at Gulfood Dubai expo earlier this year, Vinamilk said the official export of sweetened condensed milk to China is a positive signal for the company as well as the Vietnamese dairy industry in general, contributing to Vietnam’s export turnover in the situation of slowing export in the first quarter of 2020 due to the Covid-19 pandemic. Dairy Permeate in China U.S. Center for Dairy Excellence Formulas & Recipes Marketing Events Registration Policy Before you export dairy products to China: read this overview for guidance on requirements and exceptions; check our Manual for Importing Country Requirements (Micor) for full details of China’s dairy import requirements. ALE Now Exports Dairy Heifers into China to Meet Growing Demand China is becoming a major player for the Australian dairy export industry and Australia's Livestock Exporters is well positioned to meet this demand. As a result of these and other factors, demand for U.S. whey is likely to remain strong for the remainder of 2020 and into the first half of 2021. Almost overnight China has become the second largest importer of dairy products after the USA. 1. In the first half of this year alone, U.S. dairy exports to China fell 54%, largely from the trade war that’s engulfed scores of American industries. All rights reserved. The US Dairy Export Council reported earlier this month that exports to China had fallen 43 per cent since the tariffs went into effect last July. This site has been specifically designed to assist potential dairy exporters to China and provide them with all the A chunk of that was due to China and the melamine scandal in late 2008, but even if we exclude China, imports by everyone else were up 6.6%. “As a result, the tariff on Australian milk powder exports to China for the remainder of 2020 will increase from 5 per cent to 10 per cent once the tariff volume is reached,” the spokesman said. In recent weeks, China updated its lists of U.S. facilities eligible to export beef, pork, poultry, seafood, dairy, and infant formula products to China. New government figures show Australia sold a record amount of whole milk powder to China this year, enough to trigger a 10 per cent tariff on exports for the remainder of 2020. Now, a change to trading conditions for whole milk powder is expected by the Department of Agriculture Water and Environment in accordance with trade rules. New Zealand's dairy section led the rise in goods exports in November 2019 as dairy exports to China contributed to a record monthly high, according to a latest Stats NZ report released on Thursday. Earlier this year, China put 80 per cent tariffs on Australian barley, before a number of Australian abattoirs and two grain exporters were suspended from trading. But the United States has been left out of the China expansion. Global Dairy Market Outlook Export Marketing The U.S. Japan remains a vital trade partner for Australian exporters as a mature, high-value market with long-established business relationships. The Chinese government’s aggressive plans to restock by the end of 2020 are behind target based on market intelligence from USDA and are realistically likely to continue into the first half of 2021.[1]. Electronic Trade Document Exchange (eTDE) System Information Please try again. The department has told the ABC it expects the safeguard will be triggered this month, leading to a doubling of tariffs on whole milk powder, but could not say when. To determine whether a manufacturer/processor is registered to export, please consult the website of the China Certification and Accreditation Administration (CNCA). In recent weeks, China updated its lists of U.S. facilities eligible to export beef, pork, poultry, seafood, dairy, and infant formula products to China. USDA further reports that ultra-heat treated (UHT) milk imports are expected to continue increasing, and U.S. exporters have new opportunities to seize those under the commitments achieved in the Economic and Trade Agreement with China (“Phase One”). Dairy exporters have hit record milk powder sales to China this year, but are about to face a doubling in tariffs under the China Australia Free Trade Agreement (ChAFTA). But the United States has been left out of the China expansion. "Dry powder could become a top priority in terms of Russian dairy exports to China, as we have it in growing quantities in Russia thanks to the modernisation of cheese plants. In 2014, China issued Decree 145, which requires registration of … U.S. exports of dairy products to the European Union (EU), China, and Chile are subject to importing country listing requirements for manufacturers/processors as a precondition for market access. The dairy industry will meet with agriculture minister David Littleproud in a phone hook-up from Canberra on Wednesday night, to discuss a possible threat to one of Australia’s key exports. Global Dairy Market Outlook Export Marketing The U.S. She estimates that Chinese milk production grew between 2%-3% last year, while imports of whole milk powder and skim milk powder are consistently growing. Australia exports more than $1 billion of dairy produce to China each year. IDFA reported: Possible return to 2018 levels of dairy exports to China, pending year-end performance and U.S.-China relations: U.S. dairy exports to China in July may not have reached June 2020 levels, but the United States continues to see sustained recovery of its dairy exports to China, as July 2020 dairy exports to China far exceeded July 2019 exports to China, creating a pathway for U.S. dairy exports to China to rebound to 2018 levels under continued positive market conditions. These are expected to increase by roughly 20 percent by 2022. United States dairy farmers are warning that the country’s trade war with China is hurting the sector. Vice President, Trade Policy and International Affairs. Vietnam Dairy Products JSC expects to start exporting milk products to China in mid-October for the first time as it looks to tap into the world’s second-biggest dairy market for growth. EVANSVILLE, Ind., Jan. 17 (UPI) -- With the phase one trade deal signed this week between the United States and China, the U.S. dairy industry hopes to increase milk exports. Thousands of dairy cattle will be shipped to China while the Government reviews the issue of live animal exports. As relations continue to deteriorate between Australia and China, an export industry worth $1.1 billion a … Yet while the rest of the world is enjoying U.S. dairy products, China seems to be thumbing its nose. USDA reports that fluid milk accounts for more than 80% of dairy consumption in China, and U.S. export data shows U.S. producers rising to meet the demand, with skim milk exports up by over 4,000% by value and volume between January and July 2020 relative to the same period in 2019, setting U.S. fluid milk exports on target to match 2015 export quantities to China, despite the relatively small base volume. 3. The key to understanding the Chapter 6 component is knowing that U.S. ag exports to China in 2017 were $19.5 billion. China is the world's largest dairy importer and is the third largest export destination for U.S. dairy products. Volume basis: U.S. dairy export volume (milk solids basis) grew 5% in September (versus the previous year). Through the first three quarters of 2020, the aggregate volume of major products (milk powder, whey, cheese, butter and … If U.S. ag exports in 2020 increase by the $12.5 billion minimum, that would mean that U.S. ag exports to China in 2020 will be at least $32 billion. Dairy exports to China rebounded in May, with the nation seizing the second spot in U.S. dairy export … by. Since 2014, China requires the registration of foreign plants producing dairy products for exports to China. Australia's Livestock Exporters now exports dairy heifers into China to meet growing international demand. details of the exporting process can be found in our step by step guide to exporting dairy … How do pandemics usually end? The US Dairy Export Council reported earlier this month that exports to China had fallen 43 per cent since the tariffs went into effect last July. Non-compliance with China labeling regulations is one of the major reasons why products get stopped by the CIQ and customs. The guide starts with an introduction to the dairy sector introducing the major driving forces in this market. All Rights Reserved. In fact, China’s self-sufficiency in milk production declined over the past years as consumers turned to dairy imports. Last year, sales of whole milk powder to China were worth about $156 million. Apply online to export food products containing dairy like milk, cheese, butter and whey to China. But how long can the U.S. dairy industry expect to ride this recent wave of dairy demand in China, and does it apply across all dairy products? In the first half of this year alone, U.S. dairy exports to China fell 54%, largely from the trade war that’s engulfed scores of American industries. Australian exports of cotton, timber and rock lobster have also been caught up in trade disruptions. Dairy exporters have hit record milk powder sales to China this year, but are about to face a doubling in tariffs under the China Australia Free Trade Agreement (ChAFTA). Despite trade policy challenges in China and other markets, U.S. There was an error submitting the form. According to Mary Ledman, global dairy sector strategist at Rabobank, 2019 was a strong year in China for dairy consumption. Given China’s aggressive timeline and goals for restocking its swine inventory, if dairy trade is not a target of potential changes in U.S.-China relations, IDFA is optimistic for China’s continued out-performance in 2020 relative to 2019. In 2017, USDA AMS Dairy Program was recognized by China as an accepted third party certification body for conducting audits of dairy and infant formula plants. For example, Phase One removed requirements for U.S. dairy exporters to submit technical questionnaires containing processing information prior to registering for export; the agreement also updated the list of registered U.S. dairy facilities, which had been on hold for two years; and established defined labeling and regulatory parameters for U.S. fluid milks so that the Chinese government could no longer block these products as falling outside Chinese standards. These are expected to increase by roughly 20 percent by 2022. But they’ve been buying from everywhere but the U.S. Dairy Export Council (USDEC). With the Phase I agreement in place, growing Chinese demand and resurgent demand for whey, U.S. dairy export volumes to China are recovering to pre-retaliatory tariffs, pre-African Swine Fever levels. Dairy exports are explosive. Dairy exports from the US to Southeast Asia have been growing “exponentially”, and will only continue to increase as exporters eye new segments and use the region as a stepping-stone to China while a trade war between the countries rages on. With the Phase I agreement in place, demand from China is being fueled by whey, recovering to pre-retaliatory tariff and pre-African swine fever levels, and an expansion of food-grade whey proteins. Purpose of export market development. Copyright © 2020 The New Daily. Through the first three quarters of 2020, dairy exports were up 15.8% by volume. In order to facilitate China’s aggressive restocking targets, the Chinese government has excluded U.S. whey from its retaliatory tariffs – one of relatively few U.S. agricultural products that received such an exclusion. Politics has added yet another challenge. Dairy Permeate in China U.S. Center for Dairy Excellence Formulas & Recipes Marketing Events Registration Policy Beyond summer 2021, the future for U.S. whey to China is more opaque; as China levels off its swine inventory restocking, China’s feed production is projected to rise for the rest of 2020 and into 2021, consistent with China’s goals of becoming more self-reliant in a wide variety of commodities, including dairy. As a result, China’s lists now include 499 beef, 457 pork, 470 poultry, 397 seafood, 253 dairy, and nine infant formula facilities. Overall dairy exports were $6.03 billion in 2019, up 8% from 2018. 80 per cent tariffs on Australian barley, Property market roars back to life on back of RBA rate cut. By far the largest exporters are New Zealand and Australia which together account for almost 60 percent of dairy exports to China. China is Australia's number one dairy export market and continues to represent significant opportunities for both new and existing dairy exporters. Where the Chinese government had spent 2016-2020 collecting data on newer production techniques not yet well-established in China (e.g. Based on 2019 exports, we would see the volume likely reached in late October or early November.”. Milk powder, butter and cheese mainly. For more news on the trade battle between the U.S. and China, visit the articles below: African Swine Fever Could Spoil Milk Prices Products performing at 2018 levels through the end of July 2020 are whey protein concentrate, dried whey, infant formula, and NFDM, likely due to China’s continued restocking of its swine herd post-African Swine Fever outbreak and eased regulatory restrictions that were resolved under the U.S.-China Phase One Agreement. The registration with the AQSIQ is mandatory for manufacturers of dairy products. Recently, batches of Polish dairy products took freight trains to China for the occassion of Single's Day shopping festival in the country. With China’s restocking of its swine inventory only about 9 months in, piglet prices rose through the first half of 2020 and remain high. This 41-page publication is a step-by-step guide of all the stages a company has to go through when exporting dairy to China, including links to all the most relevant standards and regulations. Last week, IDFA reported that U.S. dairy exports to China in July were still trending positively relative to 2019, citing China’s restocking of its swine inventory after an African Swine Fever (ASF) outbreak in 2018 and 2019 decimated its herd. 1250 H Street, NW, Suite 900 Washington, DC 20005, https://apps.fas.usda.gov/newgainapi/api/Report/DownloadReportByFileName?fileName=Livestock%20and%20Products%20Annual_Beijing_China%20-%20Peoples%20Republic%20of_08-15-2019, Privacy ), the Phase One Agreement has loosened the handcuffs on U.S. dairy. Non-compliance with China labeling regulations is one of the major reasons why products get stopped by the CIQ and customs. Trouble for dairy farmers started in 2018, when Donald Trump engaged in a protracted trade war with China. Dairy Australia helps to improve and maintain access to overseas markets to maximise potential returns to farmers. A chunk of that was due to China and the melamine scandal in late 2008, but even if we exclude China… Chinese Labeling Requirements. With the Phase I agreement in place, growing Chinese demand and resurgent demand for whey, U.S. dairy export volumes to China are recovering to pre-retaliatory tariffs, pre-African Swine Fever levels. A notable exception to the growing consumer-oriented product exports is dairy, which experienced several setbacks in recent years. Dairy Export Council President and CEO Tom Vilsack sees many reasons for optimism in 2020 and beyond. 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