New product labels and funding to upgrade the local industry and boost sales are in the works to mitigate the impact of competition from New Zealand.

The Ministry of Agriculture is launching a series of measures to boost the demand for Taiwan-produced fresh milk to minimize the impact of the removal of tariffs on dairy products imported from New Zealand from 2025.

The zero-tariff policy for dairy products imported from New Zealand is part of an economic cooperation agreement between Taiwan and New Zealand, called ANZTEC, which was signed on July 10, 2013.

Acting Minister of Agriculture Chen Junne-jih attends a joint meeting of four legislative committees at the Legislative Yuan in Taipei yesterday.

Photo: Chu Pei-hsiung, Taipei Times

At a joint meeting of four legislative committees yesterday, Chinese Nationalist Party (KMT) Legislator Lee De-wei (李德維) asked Acting Minister of Agriculture Chen Junne-jih (陳駿季) how the policy would affect the domestic fresh milk market.

“We have been holding talks with dairy farming industry representatives in the past year… The most important thing is to increase the demand for Taiwan-produced milk and distinguish it from milk imported from other countries,” Chen said.

The agricultural industry is redesigning the label for Taiwan-produced fresh milk and has developed the technology to identify any mixture of domestically produced milk and imported milk, he said.

Lee said the ministry should consider not calling imported liquid milk “fresh milk” to distinguish it from locally produced milk.

Chen said that the quality of Taiwan-produced fresh milk, as well as its low-carbon emission production process, should be recognized and affirmed by domestic consumers, which is a better way to distinguish between these two types of milk.

Chen told a meeting of the Economics Committee on Wednesday last week that the ministry is seeking approval from the Executive Yuan for a proposal to establish a four-year dairy farming industry development fund to mitigate the impact that the new policy might have on the domestic dairy farming industry.

The funding would be used to upgrade the local dairy farming industry, create demand for domestically produced dairy products and facilitate sales of these products, he said.

“We need to review the size of dairy cattle. Of the roughly 125,000 dairy cows in the country, 12,000 sick and weak ones are to be retired,” he said.

“We will seek to reduce the costs that dairy farmers spend to buy forage grass and incorporate the weather forecast system into the grass-drying process,” he said.

“We will also monitor the quality of domestically produced milk, coordinate the pricing scheme between ranches and dairy plants, reduce carbon emissions during the production process and facilitate the sales of domestically produced milk,” he added.

To boost demand for Taiwan-made dairy products, the government would increase the supply of fresh milk to school-age children and elderly people in farming and fishing villages, Chen said.

There would also be a traceability system for Taiwan-made dairy products, it said.

Some dairy farmers have suggested that the ministry intervene and help lower shelf placement fees for domestically produced dairy products in supermarkets or larger retail chains, as the fees generally account for 30 to 50 percent of retail prices.

“Pricing strategies for dairy products are determined based on various contracts between dairy plants and supermarkets, and it would be difficult for the government to intervene,” Chen said.