With Chinese demand for imported milk and other dairy products increasing, the potential for U.S. exports is at an all-time high.
Dairy producers are facing a lot of uncertainty today—from weather to prices, politics and trade.
But one thing that we know for certain is that the Chinese market is full of opportunity. The United States shipped $384 million worth of dairy products to China in 2016, making it the industry’s No. 3 single-country export market. We are awaiting final figures for 2017, but U.S. dairy export value to China through November was up more than 50 percent vs. the previous year, while volume rose more than 20 percent.
With Chinese demand for imported milk and other dairy products increasing, the potential for U.S. exports is at an all-time high. And just recently, it was reported that China’s economy grew at 6.9 percent in 2017, overshooting the government’s original full-year target of 6.5 percent.
The U.S. Dairy Export Council (USDEC) hit the ground running in 2018 with a productive mid-January trip to Beijing.
“We are trying to create some level of certainty in a very uncertain world for the industry,” USDEC Senior Vice President Jaime Castaneda said. “This is why we visited China last week to meet with government and industry officials.”
Partnership a theme
It is important for the U.S. dairy industry to communicate its steadfast commitment to this important partnership, and to explore ways to further facilitate trade avenues to this booming market.
Continued cooperation will be key to maximizing this market—and we believe our recent meetings with key officials are a great start to 2018. We are confident that if we remain focused in our quest to lower tariffs and other trade barriers, then the Chinese market has the potential to provide some certainty in these uncertain times.
As many of you are aware, the dairy industry celebrated a great success in November, with the announcement that China was unilaterally lowering its cheese tariffs from 12 percent to 8 percent.
That announcement came only a few months after a Memorandum of Understanding (MOU) laying out dairy facility registration protocols was signed between the two nations.
Building on momentum
Our aim during our most recent trip was to seize this momentum to further facilitate trade avenues to this priority market.
While in Beijing, we met with Ambassador Terry Branstad, as well as officials from the China Ministry of Commerce, China Chamber of Commerce for Import and Export of Foodstuffs and Native Produce, Foreign Agriculture Service and others.
Our key discussion priorities included lingering issues around the established Memorandum of Understanding and updating lists as part of the dairy plant registrations, expanding industry partnerships to help pave the way for additional tariff reductions, addressing the importance of progress on a whey permeate standard and touching on our ongoing concerns with GIs (geographical indications).
The potential for job-creating U.S. exports to China is at an all-time high. But continued cooperation will be key to maximizing this market.
With this trip, we believe 2018 is off to a great start.
Vilsack is president and CEO of the U.S. Dairy Export Council.