China welcomes US dairy firms expanding in the country

CHINA – China has expressed its openness to the US and other foreign dairy companies, exploring its vast dairy market and benefiting from its development dividends.

The announcement came during a meeting between Wang Shouwen, vice commerce minister and China international trade representative, and Krysta Harden, president and CEO of the US Dairy Export Council (USDEC).

During the meeting, Wang emphasized the importance of China-US economic and trade relations, noting that the US is China’s second-largest source of dairy imports.

He highlighted the dairy trade as a prime example of mutual benefit and win-win results in bilateral trade.

“Currently, China is promoting Chinese modernization with high-quality development. The dairy product consumer market has huge potential, providing broad space for global dairy companies,” Wang said.

“China welcomes companies from all over the world, including US dairy companies, to delve into the Chinese market, carry out investment and trade, and share the dividends of development.”

Krysta Harden affirmed the US dairy industry’s commitment to the Chinese market and expressed a desire to establish long-term cooperative relationships with Chinese partners.

She added that the USDEC will continue to foster connections between the dairy industries of the two countries to promote trade, investment, and technological cooperation.

Despite a decline in US dairy exports to China, the country remains a significant market for US dairy producers, accounting for roughly 20 percent of all US dairy exports and nearly half of all US dry whey exports, according to the US National Milk Producers Federation.

The meeting also coincides with China’s domestic industries planning to apply for an anti-subsidy investigation into certain EU dairy products.

This comes amid escalating trade tensions due to the European Commission’s investigation into additional tariffs on Chinese electric vehicles.

Sources indicated that relevant Chinese industries are preparing evidence to support their application for an anti-subsidy investigation into imports of certain dairy products from the EU, highlighting ongoing trade dynamics and strategic positioning within the global dairy market.

Meanwhile, China has made remarkable progress in milk self-sufficiency, producing an additional 11 million metric tons of milk from 2018 to 2023.

According to analysts, the achievement could see a massive impact on the global dairy industry, as evidenced by the sharp decline in China’s Whole Milk Powder (WMP) imports, which plummeted from an average of 670,000 metric tons (2018-2022) to just 430,000 metric tons in 2023.

The increase in domestic production is a direct result of rising incomes and living standards over recent decades.

Previously considered a luxury item, milk and dairy products have become China’s kitchen staples, reflecting changing consumer preferences.

Despite these gains and China now emerging as the world’s second-largest dairy market after the United States, substantial growth potential remains, especially in underserved rural areas.

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