HS Code:
The goods provided for in subheadings 0401.50.75, 0402.21.90, 0403.90.65, 0403.90.78, 0405.10.20, 0405.20.30, 0405.90.20, 2106.90.26, and 2106.90.36 cover a range of dairy products including cream, milk powder, buttermilk, butter, dairy spreads, fats and oils derived from milk, and certain prepared edible products containing dairy. These products fall under the Harmonized System (HS) codes related to dairy and are subject to quantitative limits as specified in U.S. note 10 to this subchapter, which typically pertains to tariff-rate quotas (TRQs) for dairy imports into the United States. These quotas are designed to balance domestic production with international trade obligations under agreements such as the USMCA (United States-Mexico-Canada Agreement).
Total Trade Volume
Approximately $2.5 billion USD
Data from 2022
Source
United States International Trade Commission (USITC) and World Trade Organization (WTO) data
$800 million USD
32% of total trade
Increasing
$700 million USD
28% of total trade
Stable
$500 million USD
20% of total trade
Increasing
$300 million USD
12% of total trade
Stable
$200 million USD
8% of total trade
Increasing
Average Rate
Approximately 15% ad valorem
Highest Rate
Up to 35% for over-quota imports
Lowest Rate
0% under preferential trade agreements (e.g., USMCA)
Growing demand for specialty dairy products
Increased imports of high-value dairy items like specialty butters and cream products, driving trade volume growth in niche categories
2021-2023
Sustainability and organic dairy preferences
Shift towards sustainably sourced and organic dairy products, influencing export strategies of countries like New Zealand and the EU
2020-2022
Fluctuations in global milk prices
Price volatility affects export competitiveness, with lower prices benefiting exporters like Australia and New Zealand in the U.S. market
2019-2023
Under the USMCA, the U.S. increased access for Canadian dairy products, adjusting TRQs for products under these HS codes, particularly cream and milk powder.
January 2023
Enhanced market access for Canada, potentially increasing competition for other exporters like New Zealand.
Ongoing discussions between the EU and U.S. to address over-quota tariffs on dairy products aim to reduce barriers for EU exporters.
Mid-2023
Possible reduction in tariff rates could boost EU dairy imports, affecting market shares of other countries.
New Zealand reported a record export volume of butter and dairy fats to the U.S. under existing TRQs, driven by high global demand.
Late 2022
Strengthened New Zealand’s position as the leading exporter in this category, potentially filling U.S. quota limits faster.