China has agreed to reduce tariffs on dairy imports as part of the agricultural package negotiated with the United States.  Once China is admitted to the World Trade Organization, tariffs for key dairy products will be reduced as much as five-fold, according to the U.S. Dairy Export Council.

The applied tariffs for cheese, now at 50%, will be reduced to 12%.  Tariffs on lactose, yogurt and food preparations with dairy products, currently at 35%, 45% and 25% respectively, will be reduced to 10%.  The tariff on ice cream, now at 45%, will decline to 19%.  All rates will be reduced over five years in equal increments.

Last year, U.S. dairy produce exports to China reached a record $31 million, 17% more than 1997.  USDEC expects that the latest agreement, which makes imported dairy products less expensive to Chinese consumers, eventually will mean $135 million in U.S. dairy exports.

Both Tom Suber, USDEC executive director, and Jerry Kozak, CEO of the National Milk Producers Federation, commended U.S. negotiators.

Kozak said the trade pact "will greatly enhance the ability of fast-food pizza, ice cream and hamburger companies to expand their operations in China which will in turn expand our exports of U.S. dairy products used by those food service outlets."

China's fast-food industry "is poised for growth," said Suber.  "Pizza has been the driving force behind global cheese sales, and these new, lower tariffs will make pizza more affordable to Chinese consumers,  This will open the door for U.S. exporters to supply cheese to the world's most populous market."