Chinese ban on Canadian canola shocks industry
Last Updated: Friday, October 23, 2009 | 8:28 PM CT
CBC News
Canola seed is transferred from farm bins for transport. (CBC)China's abrupt cancellation of Canadian canola imports is confusing authorities who say they don't understand the rationale behind the move.
According to reports, the Chinese have expressed concerns about a fungus called blackleg.
The Canola Council of Canada says blackleg disease poses no risk to human health. Nevertheless, the Chinese insist they will not accept any Canadian canola seed shipments unless the product is certified as free of the disease.
The move is effective Nov. 15.
Officials with the Canadian Food Inspection Agency are investigating.
Last year, Canada shipped almost three million tonnes of canola to China. In Saskatchewan alone, the crop is valued at $5 billion, with the bulk of sales headed to China.
Farmer suspicious
Some in the industry suspect the move may be strategic.
"It might just be a tactic to drops prices down or to slow up some shipments that are heading their way," Kevin Plummer, a farmer with 100 hectares of canola south of Saskatoon, told CBC News. "But if they're serious about this, it's going to have long-term implications here."
Saskatchewan farmer Kevin Plummer says he is worried about the long-term impact on canola growers if China sticks to its new ban on canola imports with blackleg disease. (CBC)The blackleg fungus can only affect a canola seed if it germinates. It has no effect on canola seed pressed for oil.
Observers say the move is also suspicious because of the timing.
"[The Chinese] are going to be harvesting their canola very soon," Larry Weber, a commodities expert in Saskatoon, told CBC News. "When this was announced yesterday, their futures market … went up two per cent."
That contrasts with falling prices on some spot markets in Canada.
"China has blackleg within their own country," Weber added. "So it's a red herring."
Federal Agriculture Minister Gerry Ritz was not available for comment. His office issued a statement saying government officials were heading to China and would work on the issues.
Weber said that is a smart move.
"If you know anything about the Asian psychology, trying to negotiate with China from Ottawa to somewhere in Hong Kong or somewhere in Bejing is not going to work," Weber said. "They prefer face-to-face meetings."
Weber said Ritz should be leading the trip to China.
