March 10, 2014 — The Canola Council of Canada (CCC) sees increased opportunity for canola because of the new Canada-Korea Free Trade Agreement (CKFTA), which was announced earlier today by the Prime Minister of Canada.
CCC President Patti Miller said the agreement will secure a stable and open trade environment and ensure Canadian canola competes on an equal footing with products from other nations that have struck trade accords with South Korea, including the United States and Australia.
“This agreement is good for the whole canola value chain,” Miller said. “Canola seed, oil and meal will enter the Korean market tariff-free and on a level playing field. We expect to significantly increase our export sales to South Korea.”
In recent years South Korea has imported Canadian canola products valued at $60-90 million annually. Miller said those imports could double under the new trade agreement.
Canola seed and oil have faced unstable and discriminatory tariffs in Korea, hampering canola exports in the past. With the agreement, canola seed will have tariff free access when the agreement comes into force and canola oil tariffs will be phased out quickly. Opening this market will mean that canola will be on a level playing field with other oilseeds.
Stable and open trade is a priority of the Canadian canola industry, which exports about 90 per cent of its annual production. Total Canadian exports of canola seed, oil and meal are currently valued at more than $8.3 billion annually.
Miller said South Korea is a promising market because it has limited land for farming and is highly dependent on food imports. With its light taste, high smoke point and heart-healthy attributes, canola oil is well-suited to consumer preferences in Asia.
In the past decade, the canola industry has emerged as a powerhouse of the Canadian economy. Canada’s 43,000 canola growers have doubled production in the last decade, and the industry sees opportunities to increase production by another 40 per cent in the decade ahead.
A recent independent study found that the industry now generates $19.3 billion in Canadian economic activity and about 249,000 Canadian jobs, when the complete impact of growing, researching, processing, transporting and marketing the crop is taken into account.
“A more open trade environment contributes to economic growth and investment. It’s good for canola and good for Canada,” Miller said. “We congratulate the Government of Canada for taking this step forward.”
The Canola Council of Canada is a full value chain organization representing canola growers, value added processors, life science companies and exporters.
Media may contact:
Jim Everson, Vice-President, Government Relations