Richardson export issue with China first test of its Canola Council strategy

Richardson International announced in 2018 it had made the decision to withdraw its funding and membership from the Canola Council of Canada. At the time, the withdrawal was not without controversy, and ultimately played a major role in the Canola Council of Canada making some structural changes in late 2018.

With this week’s decision by China to suspend Richardson’s export licence due to ongoing contamination of “hazardous pests” in Canadian canola shipments, the company, Canada’s largest canola exporter, will test its strategy of  independence.

The roles that Richardson, the Canola Council, and the Canadian government will play in this issue will be an interesting dance.

Earlier this week the Canola Council released a statement saying, “We look forward to the company involved resolving the current issue,” of which some farmers took great exception, some taking this to mean the council was shirking its responsibility for helping resolve the matter.

Other farmers sent me messages like “Richardson’s made the decision to leave the council, why is it council’s role to bail them out? Sink or swim, boys.”

Richardson itself seems comfortable with the situation. Thursday on RealAg Radio, Jean-Marc Ruest, senior vice president of corporate affairs for Richardson, “we have had very good discussions and dialogue with the Canadian government, and at the end of the day they are the ones talking regulator to regulator in China that are going to work through this issue.”

Ruest emphasized to me that he was “very pleased” by the attention that Ministers Jim Carr, Chrystia Freeland and Marie-Claude Bibeau, the newly appointed Minister of Agriculture and Agri-Food, were paying to the matter.

When Ruest did not mention the Canola Council of Canada’s role in a solution, I asked him for clarification and he stated, “This is a government issue whether it’s technical……or if it’s not quality specific, other government agencies will deal with it.”

After talking to both Ruest and Canola Council president, Jim Everson, this week, both entities are keeping their distance from each other but playing relatively nice, publicly.

For the most part, farmers are cheering for a quick resolution to the issue, although everyone needs to be aware of the larger Huawei political cloud hanging over Canada’s relationship with China.

Ultimately, whether you think the Canola Council of Canada is obliged to assist Richardson for the benefit of the industry, or that the grain exporter should be left in isolation, the 2019 canola acres and farmers’ chance at profits hangs in the balance on an issue that is far bigger than just agriculture.

Related:

Farmers caught up in international issue are feeling the pinch

Why would China target Richardsons?

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