China agrees to continue current Canadian canola trade

Early reports today that China would fully re-open its market to all Canadian canola are not correct, according to both the Canola Council of Canada and Agriculture and Agri-Food Canada.

Today marks four years since Canada signed an MOU with China on the blackleg issue. Discussion this week between China and Canada have been centred on the expiration of said MOU, happening today. China has signalled that existing canola trade will continue — regardless of the MOU expiration, confirms the Canola Council of Canada.

A representative from the Ministry of Agriculture and Agri-Food Canada confirms that Customs China has indicated it will continue to allow canola imports, even with the expiry of the MOU. Delisted companies, Richardson International and Viterra, remain delisted and unable to ship canola seed to China at this time.

The representative says that there have been discussions on-going for several weeks so as to add certainty to what would happen as of April 1, with the MOU expiry. While this is not a return to full access into China, it does mean some trade will continue, and there had been delays in contracts due to the uncertainty. Currently, Canada is shipping about a third of the volume of canola seed it would have shipped pre-delisting.

Early in 2019, China halted Canadian canola from grain companies over a “technical issue” — claiming canola had been found to contain several pests species. Companies who had export licenses revoked said the shipments met all phytosanitary requirements at the time of export.

In recent history, China has bought as much as 40% of Canada’s canola crop each year. Canola exports were down 14.7%, or 641,100 tonnes, from December 2018 to 2019, largely because of lower exports to China, according to Statistics Canada.

The revoked export licenses came at a time when diplomatic relations with China were very strained over Canada’s detainment of Huawei executive Meng Wanzhou, on behalf of the U.S. government.

Worldwide trade of all commodities faces unprecedented disruption amid the COVID-19 pandemic. The virus first took hold in China late in 2019, and the country has recently started moving some manufacturing back online.

Related:

Canola oil demand rising as ASF reduces China’s soybean crush

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