Trade dispute with China leaves Canola farmers unsure what to plant
As planting season begins on the Prairies, canola farmers say a trade dispute with China has left them worried about the future.
“In the last 10 years, there’s been a lot of optimism,” Manitoba canola farmer Colin Crockatttold CTV News. “There definitely isn’t in these last few months.”
Chinese companies have stopped buying canola seeds from Canadian producers, citing quality issues. Experts say the move is revenge against Canada for the December arrest of Huawei CFO Meng Wanzhou.
Canola prices have dropped since the dispute began, and farmers say they are aren’t sure whether to bother planting the crop this spring. China used to buy about 40 per cent of Canada’s canola.
“China has been a 4.7-million-ton seed customer of ours and now that they’ve stopped buying Canadian canola,” Rick White, CEO of the Canadian Canola Growers Association, told CTV News. “The question now is, where do we ship that canola?”
The trade dispute began in early March when Winnipeg-based Richardson International Ltd.’s permit to export canola was revoked. Shipments from Regina-based Viterra Inc. were blocked later that month.
Both the Canadian Food Inspection Agency and the Canola Council of Canada (CCC) disagree with concerns raised by China’s customs agency, and have called for a scientific solution to the issue. China has yet to accept a Canadian delegation to investigate the issue.
“China has every right to take action related to plant health for products entering their country, but they also have an obligation to explain the scientific basis for their actions,” said Jim Everson, president of the CCC, in a press release.
“So far, we’ve seen little sign that China wants to engage in a science-based discussion, and therefore we need the Government of Canada to consider all available options.”
Canola farmers have been lobbying the government to increase the Advanced Payment Program, designed for farmers to take an advance on their crops in the event of a market disruption, from $400,000 to $800,000 in light of ongoing uncertainty.
But farmers are also looking for new ways to diversify the market.
“We’re looking at and asking the government to seriously consider increasing the renewable content of the diesel fuel market here in Canada,” said White.
“Canola can be used as a renewable fuel, and moving up from a two per cent blend that we have right now, to five per cent, would mean that would utilize about 1.3 million tons of canola.”
In a survey released earlier this week, Statistics Canada said it expects 21.3 million acres of canola will be seeded in 2019, down 6.6 per cent from last year, thanks to the trade dispute
Bill Campbell, president of Keystone Agricultural Producers, told CTV News that he too is concerned. “We are committed to those acres once we plant them,” he said.