Taiwan relies heavily on food supply from international trade. It has a high population density and food production is insufficient. The labor force population is declining year by year due to the low fertility rate and aging population. In 2018, Taiwan's food self-sufficiency rate is only 35%. Additionally, the actual production of agricultural land in Taiwan is about 520,000 hectares, which is far from the 740,000 to 810,000 hectares’ target prescribed by the Ministry of Interior. As an island nation, food supply depends on international trade and is regarded as dangerous. Especially in the first quarter of 2020, in which the world is in the pandemic of COVID-19, many countries have temporarily closed their borders, including global trade. For example, Argentina forcedly stopped its export of forage corn to Taiwan and this caused a significant crisis for Taiwan’s pig farmers. To strengthen food security, the Taiwan government has developed "Agriculture 4.0" to industrialize agriculture and to increase food production given its limited resources. It is therefore essential to analyze the food production, food supply chain, and food trade in Taiwan. This paper discusses Taiwan's food status and the government’s strategy in regulating food supply and food production.
Keywords: Taiwan, food security, production, agriculture 4.0, food policy
Food security includes three components: domestic production, food inventory, and imports. Even though there are contrasts across nations by the local production conditions and risk attitudes, those three components may be in various loads of significance, given the all-inclusive reason for risk diversification and decrease in cost. The present government plan of Taiwan sets a target of expanding the food self-sufficiency rate to 40% by 2020. Additionally, according to the "Domestic Rice Safety Stock Level" guideline, the food safe volume ought to be over its three-month rice consumption. Aside from those mentioned above, there is no particular food security regulation, nor is there an arrangement of import food guidelines. The Taiwan food security plan by the central legislature is inadequate (Yang, 2016).
In 2018, the production of agricultural lands in Taiwan was about 520,000 hectares (refer to graph 1), which are far below the national target. Therefore, Taiwan has shifted to the development of excellent and technology-intensive high unit price production. This method can increase farmers' income; however, it is difficult to increase the level of grain self-sufficiency, and refined production often requires more sophisticated environmental control facilities to achieve quality assurance.
Graph 1 illustrates the agricultural land use of Taiwan in 2018. Total land use for agriculture is around 800,000 hectares, and agricultural land for food production is only 520,000 hectares. Taiwan is targeting 740,000 to 810,000 hectares, so the current condition is still far from the target. This graph shows the weak investments in agricultural production in line with the low number of farm laborers (Graph 2).
Graph 2 describes the total employment of all population versus the population employed in agriculture in Taiwan. According to the graph, the working population has increased slowly by 1.09% of the total workforce from 2010 to 2019. However, employment in agriculture increased by 1.01% at the same time. Also, the agricultural workforce only has a small proportion of the total workforce which is around 4%.
Agriculture in Taiwan has not yet reached the level of capital intensive and sophisticated technology. Also, Taiwan's long-term economic emphasis is on industrial development and the service industry. For example, the revenue of TSMC (Taiwan Semiconductor Manufacturing Co., Ltd.) accounts for 6% of Taiwan's 2019 GDP (Wang, 2020). In the same year, Taiwan's agriculture only accounted for 1.77% of GDP (refer to graph 3). Therefore, Taiwan is facing the challenge of managing the state investment in agro-industry for agricultural development and its growth. Meanwhile, the policymakers doubt that more state resources are required for agricultural development.
TAIWAN’S FOOD STATUS
Graph 4 below shows the percentage of Taiwan’s self-sufficiency rate for ten primary agriculture production in 10 years. According to the food balance sheet, there are ten food categories, including aquatic products, eggs, fruits, meats, dairy products, crops, tuber crop, sugar and honey, seeds, and oilseed. From left to right, it shows the self-sufficiency rate from highest to lowest. Among them, the aquatic products with an average of 168% have performed very well for the past ten years. This means that the productivity of aquatic products in Taiwan is performing well and that it is able to export. Also, eggs, vegetables, fruits, and meats are sufficient for domestic daily consumption. Among the abovementioned, only aquatic products have surplus in the local market, while others require imports to supply domestic consumption needs.
However, the dairy, crops, potatoes, sugar and honey, and seeds and oilseed are still unable to support the daily needs of Taiwanese consumption. These products have a severe imbalance of domestic supply and demand. Besides, the most consumed products like corn, sesame, soybean, wheat, and sorghum have very limited production. Thus, it is evident that domestic food demand in Taiwan is highly dependent on imports.
According to the graph 4, besides the self-sufficiency rates of crop, tuber crop, and seeds and oilseed which have been increasing gradually, the dairy, sugar, and honey have stable performance. Rice is the major crop in Taiwan, yet people in Taiwan consume more wheat than before, and Taiwan has difficulty in producing wheat as it is both a tropical and sub-tropical country. Taro and sweet potatoes are the two favorite tuber crops in Taiwan for a long time. Nevertheless, Taiwanese had consumed more potatoes and wheat than before, which was affected by western cultures such as fried fries and white bread. Since Taiwan produces less wheat and potatoes, they chose to import from foreign countries, mainly from the United States of America (refer to Graph 5).
According to Graph 6, in 2018, Taiwan's food self-sufficiency in terms of calories basis was only 35%. Moreover, refer to the table that even though Taiwan can support almost all, it still needs imports of aquatic products, eggs, vegetables, fruits, and meats. Compared to other crops and tuber crops, those are not the significant calories resources for human beings.
Furthermore, according to the Graphs 1, 2, and 3, those graphs show that Taiwan has less investments in agriculture. In Taiwan, farming seems less profitable, which can be the reason why Taiwanese farmers are more willing to produce aquatic products, eggs, vegetables, fruits, and meats, which can generate higher profits instead of crops and tuber crops. In line with the study from Chang, Yeuh-ngo, 2020, the small farming scale, limited agriculture land, and less competitive in international market reduce the interest of farmers to work on agricultural land. To sum up, Taiwan's food self-sufficiency percentage tends to be low (35%) (refer to Graph 6). The benefit of agriculture activity is less profitable, and farming is not enough in Taiwan.
The food security issue
Production: Taiwan's agricultural land is limited; farmers face challenges in completing the production model of the Intelligent Production Alliance to achieve large-scale production. The essential goal is to be able to produce agricultural products with stable quality and quantity. This goal requires high-cost environmental control facilities and quality standardization equipment. However, the government-sponsored production technology and equipment as a plan for new industrial operations and collaborative risk management in smart agriculture is only for more substantial scale farmers.
Distribution: Taiwan’s agriculture often faces overproduction and due to the small domestic market, so the food price fluctuates. Flexible distribution systems form a dynamic mode of production adjustment to assist farmers in selecting crops to be planted and intelligent logistics to reduce agricultural wastes.
Food storage: the current issue is the high level of food losses due to the lack of storage management so much so that food is wasted even before the distribution process. In 2018, the rate of loss of Taiwan's vegetable and fruit production was 40% (refer to Graph 7) (Executive Committee of the Agriculture Committee, 2018). The leading cause of food loss in Taiwan is attributed to slow sales due to overproduction, weak storage management such as temperature and packaging, damage to the supermarkets, and the amount of food wastes that is deliberately discarded due to low-quality, insect bites and black spots. Therefore, the majority of production losses are caused by mismanagement, and most of it can be resolved with existing technologies and capital, such as planned production, procurement, stockpiling, and cold chain management.
Taiwan Food Bank has collaborated with supermarkets in district and city levels to provide the lunch boxes from the surplus food for social welfare, such as economically vulnerable families. The Housewife Alliance Taiwan also benefits farmers and processing producers through a shared purchase model, green consumption, and a friendly environment. It launched a "Weekly Basket" activity in 2014, which has saved about 8.1 tons of Grain Loss (Taiwan Agriculture Story House, 2018a). At present, Taiwanese producers need to improve agricultural technology reforms, distribution, processing, and marketing, effectively recording every data, and making full use of all collected information to achieve smart agricultural operations 4.0.
MID-TERM FOOD POLICY OUTLINE (2017-2020)
Enhance industrial competitiveness
Establish a new model of agriculture-develop industrial characteristics and create new advantages
- Provide support to small farmers through fostering enterprise farmers, organize strategic industrial alliances, construct group producers as supply systems, expand the scale of industrial settlements, adjust industrial structure, and innovate new agricultural products.
- Accelerate the industrialization of agricultural science and technology, promote bio-economics, create market-oriented agriculture, and add value. The strategy is integrating with the development of green economy through energy savings, waste reduction, and reduced emissions circles.
- Improve the management of the livestock and poultry industry to improve production quality. This could be achieved by strengthening the level of pig breeding, promoting green energy and reusing biogas (power plants) in livestock houses, counseling on raising beef cattle, conducting modern meat management, and post-slaughter management.
- Promote the use of locally produced local ingredients for school lunches, promote food and agricultural education to improve local economic performance.
- Integrate agricultural training resources to guide young farmers, help in obtaining agricultural land and funds, build systematic agricultural training courses and areas of practice, and increase the level of human resources in the agricultural workplace.
- Strengthen the exchange of information on agricultural land leasing platforms by linking information on land leases belonging to the state and public companies.
- Promote policy-based agricultural project loans to support the funds needed for agricultural innovation. By increasing the operating constitution of the farmer's credit department, strengthening the monitoring function, continuing to process collateral loans for agricultural loan funds, and assisting farmers and fishers in obtaining operational funds.
MAINTAIN ECOLOGICAL SUSTAINABILITY AND STRENGTHEN DISASTER PREVENTION CAPABILITIES
Establish a new model of agriculture-strengthen the ability to adapt to climate change and maintain environmental sustainability:
- Improve the quality of a stable supply of products, promote the use of green energy facilities in agriculture, fisheries, and animal husbandry. The ultimate goal is to achieve a win-win situation and maintain sustainable environmental development.
- Increase the use of big data to re-design the production areas of environmentally friendly groups that integrate water, land, and people, build ecological services and agricultural R&D, and climate-intelligent production systems.
- Improve forest resource management, protect natural forests, and promote long-term forest monitoring systems. The trick is to promote tree planting, mobilize the benefits of forest carbon sequestration, sustainable management of artificial forests, and increased use of wood and non-wood products.
- Strengthen conservation and rehabilitation of marine fishery resources. The strategies include prevention of illegal fisheries, strengthening scientific management, and improvement of public drainage facilities in agricultural areas and fisheries production.
- Improve integrated natural disaster prevention procedures. The way to do this is by strengthening the prevention of the flow of soil and rocks and building a system for preventing and mitigating large-scale collapse, accelerating the improvement of rural road facilities outside the rezoning area, activating agricultural ponds, and water conservation
- Strengthening agricultural insurance and risk management systems to reduce farmers' losses due to climate change and natural disasters.
Building a sustainable and peaceful rural area
Establishing a new model of diversified farming system, creating a peaceful and happy society in the countryside:
- Promote new farmers and improve the quality of the agricultural workforce by developing rural regeneration communities. The application of this plan is by combining the development of specialized industries with recreational tourism services, preserving the ecology and culture of the countryside, promoting the tourism theme of the four seasons of agriculture (combining humanities, history, and eco-tourism)
- Enhancing collaboration with local governments and farmers organizations, helping farmers organizations use local industrial resources, combining rural communities and young farmers, and developing rural economic business innovations
- Enhance welfare benefits for elderly farmers, protection of farmers 'rights, planning for farmers' pension systems, strengthening social safety net measures, and protecting the lives of farmers.
- Promote the concept of respecting animal life by strengthening pet management such as sterilization, increasing the efficiency of animal containment management, fostering healthy animal protection organizations, and strengthening public-private cooperation networks.
Building an agricultural safety system
Building an agricultural safety system-improving food security, strengthening traceability management of agricultural products, and ensuring food safety.
- Improve agricultural land information systems. This plan's application can take the form of an accurate and actual inventory and publication of land quantities of agricultural production areas, overall planning for potential production areas for sustainable agricultural development, and integrated utilization mechanisms to maintain high-quality agricultural production areas.
- Improve groundwater conservation and irrigation. The application of this plan is to promote the restructuring of the Agricultural Groundwater Conservation Association, expand the scope of irrigation services, improve irrigation efficiency, develop new energy-efficient, low-cost farming water, and promote rational planning of agricultural irrigation water quality.
- Improve the quality, efficiency of production, and sales resume of environmentally friendly and organic agriculture products, increasing agricultural products' safety, and green environmental subsidies.
- Improve policies promoting large grain silos to substitute imported grains.
- Merge innovation and applying forward-looking technologies such as biotechnology, information, and communication. The aim is to increase resource utilization efficiency, implement phytosanitary systems and plant health management, and protect the environment.
- Increase the efficiency of preventing epidemics and quarantine of animals and plants. The application of this plan is to strengthen the integration of epidemic prevention, establish early warning mechanisms for epidemic situations, establish rapid inspection centers for infectious animal pests and diseases, implement a food registration system and control the spread of epidemics, and assist the rapid recovery from the epidemic
- Strengthen the monitoring of pesticides, heavy metals, and animal drug residues in agriculture. The application of this plan by expanding random monitoring and inspection of the safety of agricultural, medicinal products, as well as inspection of heavy metal pollution from agricultural materials such as fertilizers and commercial feeds, strengthening livestock practices agriculture, fisheries, and livestock.
- Promote Good Agricultural Practices (GAPs) in Taiwan. GAPs include the construction of production safety management capabilities, local agricultural product tracking systems, strengthening food safety management and control effectiveness, strengthening the system for reliable labeling verification of agricultural products, and integration with international regulations.
- Follow precautions for the cross-border spread of African swine fever. Handling anti-epidemic propaganda for industrial operators, carrying out active monitoring and preparation of related materials and increasing the capacity of African swine fever inspections to maintain agricultural production safety in the domestic market.
Strengthening the international competitiveness of agriculture
Enhance agricultural marketing capabilities-strengthen technical advantages and global layout markets:
- Build an agricultural product export platform to provide complete production and marketing information, export counseling, incentives, and matchmaking measures. The platform might support the locals in the global market competition through agricultural, fishery, and livestock products.
- Cultivate a new generation of agricultural management talents with cross-domain cooperation and international market development capabilities to enhance the industry's global competitiveness.
- Actively participate in economic and trade negotiations of international organizations, strengthen bilateral agricultural consultations, breakthrough tariff, and non-tariff trade barriers, and strive for our agricultural products to enter the global market.
- Assist large agrarian enterprises in development, strengthen the international marketing of agricultural, forestry, fishery and livestock products, consolidate existing and open up new markets; develop market-oriented agricultural products export industry, establish multiple marketing channels, and increase farmers' income.
- Promote international cooperation with the core of improving agricultural technology and maintaining food security, strengthen the energy of agricultural technology consultation, and expand the export opportunities of agricultural technology services.
- Promote new agricultural southbound policies, enhance bilateral trade and investments between Taiwan and the new southbound countries, strengthen the southward emerging markets of agricultural products, promote the diversification of export markets, and expand global business opportunities.
Improve the efficiency of resource allocation
Properly allocate budget resources to improve budget execution efficiency:
- Strengthen the implementation of the capital budget and enhance asset use effectiveness.
- Enhance opportunities for reporting within the mid-range annual budget estimates: When preparing yearly budgets, consider the ability to implement the plan, the spirit of this zero-based budget, and verify the various funding requirements to allocate resources appropriately (Laws and Regulation Database of the Republic of China, 2017; Council of Agriculture, 2017).
THE INVOLVEMENT OF AGRICULTURE 4.0
Agriculture 4.0 aims to make intelligent agricultural production and to digitize agrarian production and marketing services, through cloud technology, big data analysis, intelligent machine technology, and agricultural integration intelligence sensors. The second objective is to promote the improvement and transformation of domestic agricultural innovation and reliable human resources.
The leading technologies currently used in intelligent agriculture are remote sensing technology (RS), global positioning systems (GPS), geographic information systems (GIS), expert systems (ES), intelligent decision-making knowledge systems, and big data analysis. This technology application includes soil monitoring, plant growth, current climate review, physiological monitoring of plants such as nutrition and quality, and ecological monitoring modules (soil moisture, luminosity, temperature, humidity, and pest monitoring).
Domestic agricultural technology has implemented Agriculture 4.0 to accurately control agricultural production, complete a fully automated production technology system, open and transparent production information to consumers, and use the Internet to adjust the business model of distribution operations and build real-time estimates of supply and demand.
Agriculture 4.0 emphasizes the application of e-commerce and digital management and analyzes agricultural production and market trends with big data to achieve the goal of reducing production wastes. At present, in addition to the Asia Pacific Economic Cooperation multi-year plan that is actively implemented by the Taiwanese government, it also aims to hold seminars, find the best strategy, and promote its implementation.
Consumer education and promotion strategy
With the development of Taiwan's advanced economy, consumer preferences are changing to choosing healthier and more natural agricultural products. So the Taiwan government is actively promoting products and sales to track the production process of agricultural products to ensure that consumers can get the best quality products. Consumer choices will influence producers' decisions.
Some consumer groups in Taiwan tend to choose cheap and fast food products. However, the government still filters low-quality food products before they enter the market. However, due to weak purchasing power in the market, it leads to slow sales of agricultural products.
Therefore, in Taiwan's Agriculture 4.0 plan, in addition to emphasizing government certification and tracking the production process and sources of producer crops, it is more important to change the consumption habits of Taiwanese consumers. The strategy is to educate and promote consumption behavior that is more environmentally friendly and prioritizes quality. For example, to reduce energy wastes and food wastes, the government suggests the practice of consuming nutritious foods as a way to achieve better health rather than the tendency to simply consume foods in restaurants. It also promotes awareness of sustainable agriculture in an environmentally friendly production (Chen & Yang, 2017).
Taiwan's agriculture production is dominated by smallholder farmers and is very competitive from an individual perspective. However, from an industry perspective, the labor force is still facing severe challenges. The development of agriculture in Taiwan, densely populated, is relatively less economical than the manufacturing and service industries, but it is indispensable. In today's society, with technological reforms and the evolution of the global environment, agriculture in Taiwan is critical. However, there is no way to replace the secondary and tertiary industries as the pillar of the national economy.
Through the development of agriculture 4.0, Taiwan's food security can be more guaranteed, and the agricultural economy can be made more abundant, and this includes Taiwan's agrarian reform. The government has significant leadership responsibilities, but also requires active cooperation from farmers and operational support from consumers. Agriculture 4.0 is not only a change in the agricultural production model for Taiwan but is also a structural reform of society, from top to bottom, from the government to the people. All links must be interlocked to achieve real agricultural reformation.
For the Taiwan government, improving agricultural technologies is similar to protecting Taiwan's food security and the rights and interests of farmers, rather than making a profit. In 2015, The Taiwan government launched a new concept of "Productivity 4.0," which means that from the first tier to the third tier industry, information and production are using Artificial Intelligence. Productivity 4.0 uses internet technology involved in production, processing and delivery, sales, market evaluation, surveys and other aspects.
The government's current main objectives are fully automated production, adequate environmental control, management systems, proper post-harvest handling, and food distribution. The applications tend to be fully automated to prioritize solving the plight of scarce labor in agriculture. In summary, the Taiwan government's Midterm Food Policy and Agriculture 4.0 program, synchronization support production competitiveness in the quality of global standards, environmental sustainability, sustainable and peaceful rural areas, efficiency, and farmer protection.
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