OTTAWA, ONTARIO, CANADA — As market access issues continue to block canola exports to China, Marie-Claude Bibeau, minister of Agriculture and Agri-Food, and Jim Carr, minister of International Trade Diversification, announced support for Canadian canola and its producers during the time of uncertainty.
During a May 1 press conference Bibeau confirmed changes were being made to the Advance Payments Program (APP) to help ease the cash flow pressures that farmers are facing and help them manage the impacts of market disruptions.
The regulatory amendment would change the loan limits for the APP for the 2019 year as follows:
- Advances of up to $1 million will be available on all commodities, more than double the previous limit of $400,000.
- The first $100,000 will remain interest-free on all commodities, except canola. Canola advances will be eligible for up to $500,000 (total) interest-free.
The federal government will work with thirty-six APP administrators to put these changes into effect.
Since market access issues affecting canola seed trade started in early March, Chinese buyers remain unwilling to purchase Canadian canola seed and the licenses of two companies, Richardson and Viterra, to export canola seed to China have been suspended. While technical discussions have taken place between the Chinese and Canadian governments, the scientific basis for China’s actions remain unclear.
“We stand shoulder to shoulder with Canada’s canola producers and farm families across the country and we will continue to listen to their needs,” Bibeau said. “Canada has the best canola in the world as well as a very robust inspection system and together we are taking a team Canada approach to resolve the issue and we will continue to work with canola working group with the stakeholders and the prairie provinces.”
On April 1, Agriculture and Agri-Food Canada formed the Government of Canada Canola Working Group, made up of representatives from both industry, and provincial and federal governments.
The working group was created after China suspended the licenses of two Canadian companies to export their canola seed to China, citing non-compliance with its plant health requirements. The AAFC noted that at the same time China strengthened its inspection measures on all Canadian canola seed shipments.
“The canola industry contributes C$270 billion and 250,000 jobs to our economy and in 2018 Canada exported more than C$11 billion in canola products to more than 50 markets worldwide,” Carr said during the press conference. “We recognize the challenges around the uncertainty in the canola market and the importance of resolving the issue of China’s restrictions on imports of Canadian canola seed. We understand how much of a concern this is to farmers across western Canada and the entire industry.
“I would like to emphasis that Canada will continue to navigate the challenging period with China through carful deliberate and strategic engagement, but we are also working to expand our export markets. It is critical that Canadian exporters have readily available markets when faced with trade disruptions. Our country’s continued prosperity and job creation depends on securing markets abroad.”
Carr announced he will be leading a canola trade mission to Japan and South Korea in early June. Carr’s outreach will build on his work to engage other high-potential countries, including: UAE, Thailand, Malaysia, Pakistan, Bangladesh, Mexico, Germany and France.
“According to the Canadian Canola Council our new agreements with Asia Pacific countries alone is expected to result in C$780 million worth of new canola exports,” Carr said. “So trade deals are like bridges to cross where people, goods and services can flow. These bridges provide access to immense opportunities for businesses to grow and compete in national markets and these bridges mean there are significant prospects of market diversification of Canadian canola products. I know from speaking with industry officials and governments in key emerging markets that there is strong interest around increasing canola trade with Canada.”
The CCC supports Canadian governments push to expand into new markets.
“It’s an ideal time to bolster our efforts to provide our top quality products to other customers,” said Jim Everson, president of the CCC. “We need to seize the opportunity to develop markets, especially in Asia, building on our trade agreements.”
The CCC did note while producer support and market diversification are a priority, so should regaining access to the Chinese market.
“We need to consider all options to resume seed exports to China,” Everson said. “Predictable, rules-based trade is critical to Canadian agriculture and China remains an important market.”