Wheat
Production Taiwan grows a small amount of wheat with planting in November and harvest in March of the following year. Wheat production is forecast to remain flat in MY2018/19 at 6,000 tons. Estimated MY2017/18 wheat production is raised 1,000 tons, to 6,000 tons, on 3,000 hectares. The Council of Agriculture (COA) is using subsidies to encourage farmers to grow corn, wheat and soybeans as a rotation crop to reduce import demand and this program has resulted in a small increase in wheat acreage. COA has initiated a wheat breeding program to develop wheat varieties that can adapt to Taiwan’s climate and soil. The main variety grown now is Taichung #2, a medium protein hard red wheat variety that was initially bred three decades ago. COA’s Agricultural Research and Extension launched Taichung #35, a low protein soft white wheat variety, in December 2017 for the winter planting season. Taichung #35 was bred to tolerate Taiwan’s hot, humid climate and resist wheat rust and mildew.
Consumption
Wheat consumption is gradually growing in Taiwan as people eat less rice and more wheat-based products such as noodles, buns, and baked goods. According to COA statistics, per capita annual wheat flour consumption increased 2.3 percent in 2016 to 37.9 kilograms. At the same time, per capita annual rice consumption fell 2.6 percent to 44.5 kilograms. Increased per capita consumption of wheat is partially offset by the aging of Taiwan’s population and lack of population growth. Due to these trends, total wheat consumption is forecast to expand only slightly in MY2018/19 to 1.375 million tons. MY2017/18 wheat consumption is lowered 15,000 tons to 1.37 million tons based on Ministry of Economic Affairs (MOEA) flour production statistics and import trends. Food, seed and industrial (FSI) consumption is forecast to increase slightly in MY2018/19 to 1.3 million tons. 66,000 tons is used for food fermentation (e.g., soy sauce), and most of the rest is milled into flour. [Note: Total consumption is FSI plus feed and residual usage.] According to a recent market survey, over one-third of flour is used to produce noodles and steamed buns. Taiwan’s milling capacity is estimated at 2 million metric tons on a 24-hour-300-day operation basis. Current capacity utilization is estimated at 60 percent. Based on further review of COA statistics, feed and residual in MY2016/17 and MY2017/18 is raised 50,000 tons to properly account for wheat feed use. FSI consumption is lowered for those years to subtract feed use and reflect current MOEA flour production estimates.
Trade
Taiwan relies on imports for 99 percent of its wheat. As a result, imports closely track consumption. MY2018/19 wheat imports are forecast up slightly to 1.435 million tons on rising demand. MY2017/18 imports are lowered 70,000 tons to 1.43 million tons on import trends. The Taiwan Flour Millers’ Association (TFMA) uses group purchases to import U.S. wheat via bulk vessels. These purchases account for approximately 75 percent of imports. The remaining 25 percent mostly consist of containerized shipments from Australia and Canada. In 2017, 58 percent of U.S. wheat imported under group purchases was Dark Northern Spring, 30 percent was Hard Red Winter, and 12 percent was low protein wheat. The tariff on wheat is 6.5 percent, while the tariff on flour (HS 1101) is 17.5 percent in order to protect the domestic milling industry. Flour and other processed wheat products account for only four percent of Taiwan wheat imports. All of Taiwan’s wheat exports are flour or other processed products. Stocks Millers typically hold 1-2 months of stocks to avoid disruptions in operation. Stocks are forecast to stay stable at between 550,000 – 560,000 tons in MY2018/19 and MY2017/18.
Date:3/30/2018 GAIN Report Number:TW18010
Taiwan Grain and Feed Annual 2018 Grain and Feed Annual
Approved By: Mark Petry Prepared By: Chiou Mey Perng and Andrew Anderson-Sprecher
Report Highlights: Rice production continues to be strong despite falling demand, as many farmers prefer the guaranteed income that comes from the government rice procurement program. As a result, rice stocks are forecast to rise by 12 percent and exceed 500,000 tons in MY2018/19, equaling almost half of annual consumption. Taiwan continues to be a top export market for U.S. grains due to stable consumption and feed demand. In 2017 Taiwan was the 6th largest export market for U.S. corn and 7th largest for wheat.
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