In order to carry out the preliminary investigation on the industrial injury of the "Taiwan Brewers Association's application for levying anti-dumping duties and provisional levying anti-dumping duties on imported beer produced from the Chinese Mainland", the International Trade Department of the Ministry of Economic Affairs of Taiwan held a hearing on April 8. The Taiwan Brewers Association attended as the applicant and supporter to present their opinions. On the opposing side, representatives of Budweiser, Snow Mountain Beer, KIRIN Bar and other imported beer from Chinese Mainland attended.
The Association stressed that Chinese Mainland beer was dumped in Taiwan at a low price, with a dumping margin of 59.93%, which is equivalent to nearly 5 yuan (NT $, the same below) lower than the normal market price of 330ml beer per can, which makes local brewing beer face unfair competition and indeed causes industrial damage.
Zeng Huanchang, the president of Taiwan Brewers Association and also the vice president of Taiwan's tobacco and alcohol industry, stressed that although the opposition repeatedly stressed that the change of market taste was the key to consumer choice, the impact on Taiwan's beer industry was consistent with the time point of the brands involved in the case to set up factories in Chinese Mainland around 2016. At the same time, no matter the local industry in Taiwan or other non Chinese Mainland importers, there were changes in emerging tastes and new products, but only the beer market in Chinese Mainland increased significantly. It was obvious that the opposition's statement was just an excuse to resist the identification of industrial damage in Taiwan.
Chinese Mainland beer has no unique taste Low price strategy is the key to industrial damage
The opposing party argues that beer belongs to the category of consumer goods for people's livelihood and should not use the formula for calculating the dumping margin in past anti-dumping investigations. However, the association questioned whether the existing market research covers the entire channel, product range, and sufficient time period, and whether the relevant investigation covers the results of promotional discounts, as well as the basis and sources of supporting materials behind the relevant market research. The opposing party did not provide effective explanations during the hearing process. Based on this reason, there are doubts about the fact that the price reduction calculated based on government import and export statistics has reached 40%.
The opposing side also actively advocated that the factors influencing the market trend were the taste of easy to pull beer rather than the price, and proposed that because consumers preferred the refreshing taste, Chinese Mainland beer had only grown in the market in recent years. In this regard, the Taiwan Brewers Association believes that taste is certainly an important consideration in choosing beer. Taking the market survey issued by the opposition as an example, Taiwan beer and other non Chinese Mainland imported beer also have similar consumption preference options. Therefore, Chinese Mainland beer and Taiwan beer are not decisive in taste, and price and promotion methods are still the main judgment basis for consumers.
As for the promotion means, the Association further explained that because the import price is very low and the opposing party has no dispute, the beer agents and dealers in Chinese Mainland have more budget space to carry out marketing and promotion strategies, so as to increase their market share. The result is also very successful. However, the space for diversified marketing and promotional strategies ultimately comes from the improper import advantage of reducing prices by more than 40%.
In addition, beer in the market can be roughly classified into economy, mainstream, and high-end according to the price band. The opposite party deliberately confuses the price positioning of imported and Taiwan produced beer, compares the relatively high priced products in Chinese Mainland with the relatively low priced products in Taiwan, and deliberately ignores the fact that the average import price is only 40% of the factory price in Taiwan, which clearly confuses the public.
The share of beer made in Chinese Mainland in Taiwan market has risen year by year, and the profit of Taiwan beer has declined year by year
According to the Association's open anti-dumping application, from 2021 to 2023, Taiwan's beer industry's domestic sales business interests declined by 19.44%, and the share of beer in Chinese Mainland's Taiwan market soared from only about 9% in 2016 to more than 32% in 2024, seriously eroding the Taiwan market.
The shrinking market has also led to a gradual decline in the utilization rate of Taiwan's beer production capacity since 2021, with a decrease of 4.75% in 2023 compared to 2021, and a further decline of 14.99% from 2024 to September compared to the same period in 2023. In addition, the operating profit of domestic sales of beer produced in Taiwan has also been declining year by year, with a decrease of 19.44% in 2023 compared to 2021. The investment return rate has also been decreasing year by year, and the cash flow has turned from positive to negative, which has affected the capital allocation of Taiwan's beer industry.
Beer manufacturers in Chinese Mainland have gone beyond fair competition, hoping to safeguard market environment and consumer rights
The situation of dumping in Chinese Mainland has become the focus of common concern of countries in the region, and governments of all countries have also launched trade investigation measures. In order to improve the unfair competitive environment, the Taiwan Brewers Association has applied for an investigation based on government anti-dumping regulations and sought relief through legal channels. The local beer industry in Taiwan and the goods of other countries not involved in the case absolutely have sufficient technology and abundant quantity to provide consumers with diversified choices and consumption experience, but the premise is that the market must maintain fair competition, rather than allowing Chinese Mainland to produce beer at low prices to destroy the economy and employment of the beer industry in Taiwan, which will also harm consumers' rights and interests for a long time.
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