December 5, 2017 – Earlier this week in Beijing, Canadian Prime Minister Justin Trudeau and Chinese Premier Li Keqiang concluded the second Annual Leaders’ Dialogue between Canada and China. The talks provided a forum for trade priorities to be raised, including the approval of canola biotech traits.
“Although formal trade negotiations have not started yet, we appreciate the Government of Canada’s commitment to positive China-Canada trade relations,” says Jim Everson, president of the Canola Council of Canada (CCC). “China is a very important export market for Canadian canola, with significant potential for growth.”
Everson participated in a roundtable with Prime Minister Trudeau and had the opportunity to meet with government officials to advocate for a more a stable and predictable trade environment.
“We are thankful for the efforts made by Prime Minister Justin Trudeau, International Trade Minister François-Phillipe Champagne and Agriculture and Agri-Food Minister Lawrence MacAulay to advance canola priorities,” says Everson. “We’re hopeful their interventions will soon lead to lower tariffs and new seed innovation being adopted in Canada.”
Currently, China’s tariffs on imported canola seed (9%) are three times higher than those applied to soybeans (3%). China has been eliminating tariffs on oilseeds in its trade negotiations with other countries. Chinese tariffs on canola oil are 9% while canola meal has a 5% tariff.
The Canadian canola industry is also eagerly awaiting China’s approval of three canola biotechnology seed traits. Until these traits are approved in China, Canadian farmers cannot benefit from them.
“After approval in China, these traits will help Canadian farmers adopt innovation and be more competitive, producing an estimated $400 million more canola every year using the same amount of land and inputs,” says Everson. This improved productivity will come from the increased yield of new seed genetics in combination with the new traits, providing better weed control, disease resistance and resilience to weather stress as well as reduced harvest loss.
Chinese biotechnology approvals are slow and unpredictable. Everson is hopeful that the recent visit by Agriculture and Agri-Food Minister MacAulay and the latest visit by Prime Minister Trudeau will lead to the timely approval of these important biotech traits.
An independent analysis commissioned by the CCC says that eliminating Chinese tariffs on canola could create 33,000 additional jobs in Canada from increased exports of canola alone. The study by Dan Ciuriak, former deputy chief economist with the federal trade department, found that eliminating China’s tariffs on Canadian canola could increase exports of seed, oil and meal by up to $1.2 billion per year. That would be the equivalent of 1.8 million tonnes of canola or about 10% of Canada’s current annual canola production.
After the United States, China is the largest export market for canola and canola products worth $2.7 billion in 2016. China imported 4.8 million tonnes of Canadian canola in 2016 – including 3.5 million tonnes of seed, 600 thousand tonnes of oil and 660 thousand tonnes of meal.
The Canola Council of Canada is a full value chain organization representing canola growers, processors, life science companies and exporters. Keep it Coming 2025 is the strategic plan to ensure the canola industry’s continued growth, demand, stability and success – achieving 52 bushels per acre to meet global market demand of 26 million metric tonnes by the year 2025. This year, the Canola Council celebrates its 50th anniversary. Visit CanolaHistory.ca to learn more.
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Heidi Dancho, Director, Communications