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Ottawa asks Beijing to allow Canadian canola experts to visit China in trade row

Canada's agriculture minister has made a formal request for Chinese authorities to allow Canadian canola experts to go to the country to help resolve an escalating trade dispute between the two countries.

Two Canadian canola exporters have had their licenses to sell in China revoked

Under normal circumstances, China buys billions of dollars worth of Canadian canola every year but trade in the crop has dried up in the face of export bans in recent weeks. (Jeff McIntosh/Canadian Press)

Canada's agriculture minister has made a formal request for Chinese authorities to allow Canadian canola experts to go to the country to help resolve an escalating trade dispute between the two countries.

Marie-Claude Bibeau says she sent a letter to her Chinese equivalent to receive a Canadian canola delegation that would be led by the president of the Canadian Food Inspection Agency, along with her team of plant health experts, and the support of technical experts from the Prairie provinces.

Parliamentarians including Bibeau and International Trade Minister Jim Carr said at a press conference on Monday that the federal government has formed a working group with many canola-producing provinces to try to resolve a situation that has seen Canadian canola sales to China dry up.

China alleges it has found pests in Canadian canola, and has revoked the licenses of two Canadian canola shippers, Richardson International, and Viterra.

But, there has been speculation that the allegations of dirty canola are just a red herring, and the clash is really about worsening geopolitical relations between the two countries as a result of the detenion of Meng Wanzhou in Vancouver late last year.

Carr disputed the notion that there are any problems with Canadian canola, and says it's time for China to prove those unfair accusations if they can. "If there is a problem with our shipments, show us the science so our skilled and dedicated industry leaders may rectify it," Carr said.

Canada exports more canola than anyone else, and China is a major customer. (Scott Galley/CBC)

"We think the next step is to … not only have a video conference but face to face conversation with experts from Canada and from China," he told reporters.

The federal government says its working group will include the two companies hit by export bans, but also the group that represents the industry in Canada, and people from the governments of Manitoba, Saskatchewan and Alberta.

"We're pleased that the government has recognized the seriousness of the issue and taken action," said Jim Everson, president of the Canola Council of Canada. "As a group, we'll be meeting right away to continue resolving the issue and to help the sector navigate the uncertainty it is causing."

While so far only two Canadian canola companies have been hit by a ban, the Canola Council says all of its members have been reporting that orders for canola seed to China have been drying up, without explanation, for weeks.

Under normal circumstances, China is a major buyer of  Canadian canola, accounting for approximately 40 per cent of all canola seed, oil and meal exports. Canola seed exports to China were worth $2.7 billion in 2018. Demand has been very strong until recent disruptions.

The government says it is working with other nations to try to absorb all that suddenly excess canola, but the CEO of Richardson says that could be easier said than done.

If the current disruption continues over the long term, we will have no choice but to find other markets for Canadian canola seed.- Curt Vossen, Richardson International CEO

"If the current disruption continues over the longer term, we will have no choice but to find other markets for Canadian canola seed. However, doing so will be no easy task, and can only occur over a longer period of time," Curt Vossen told Reuters.

He said if the impasse persists, he expects plantings of new crop will sink, which will impact next year's crop.

"Inevitably, there will be some pullback where it is possible … I can see five to 10 per cent — it may be more, it may be less," he said.

Vossen also warned that other Canadian crops could soon find themselves in China's crosshairs. While there are no signs yet that China is also moving to curb imports of Canadian wheat and soybeans, "there's always that concern," he added.

Ottawa has a number of programs designed to give financial assistance for farmers impacted by the sudden canola problem, and  Bibeau says it's possible that Ottawa will increase cash advances to them as situations warrant.

With files from Reuters

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