First ever “Canola Dialogue” event in China
At the opening of the first ever Canada-China Canola Dialogue, Bian Zhenhu, president of China Chamber of Commerce of Import and Export of Foodstuffs, Native Produce and Animal By-Products (CFNA), remarked on the healthy relationship between Canada and China since the 1970s and the great potential for canola sales into China, particularly targeting the large middle class.
Canada’s Minister of Agriculture and Agri-Food Lawrence MacAulay, in his address at the Dialogue, reminded everyone in the room that “when you buy Canadian canola, you are buying the best.” MacAulay was in China leading a Canadian industry trade mission, and the Dialogue was a key part of his agenda. Canola represents about half of Canada’s agri-food exports to China. He said the Government of Canada is committed to working with China for the good of Canadian canola trade.
Over the past decade, China has become a large and reliable market for Canadian canola seed, oil and meal. China is the top market for Canadian canola seed, buying just under 4.0 million tonnes through the 2016-17 crop year. China also accounted for 26 per cent of Canadian canola oil exports in that period, second to the U.S., and 19 per cent of meal exports, also second to the U.S. In all, Canadian canola trade to China in 2016-17 was $3.4 billion – 30.6 per cent of the total value of Canadian canola exports. (Find these numbers and more in the November Canola Digest article, “Canola Market Snapshot 2017”, online at canoladigest.ca.)
China needs food imports. While the nation of 1.4 billion people is highly productive – with government policy supporting and achieving near self-sufficiency for rice, wheat and corn – it will continue to buy large quantities of vegetable oil to meet domestic demand. Canadian canola oil, with its high quality, reliable supply, low saturated fat and high heat point, should have strong appeal among Chinese cooks. Canola meal is also a good value option for Chinese dairy, swine and aquaculture producers.
The Dialogue provided an opportunity to emphasize these points. It also gave Chinese authorities a chance to share their perspectives. Huang Yajun, division chief for China’s Administration of Quality Supervision, Inspection and Quarantine (AQSIQ), the regulatory agency responsible for the safety of grain imports, discussed blackleg and dockage.
In September 2016, Canada and China agreed to implement a science-based workplan that mitigates the risk of blackleg to China. The risk with dockage, China has said, is that it could introduce blackleg L. maculans into China. Canada says the risk is very low, and virtually zero when these shipments go straight to the processor. Canada also says lowering the dockage specification doesn’t change this.
“We are patient enough. We will wait for 2020,” Huang said (speaking through an interpreter) in reference to negotiations.
Part of the purpose for the Dialogue is to present these points in an open meeting so they may be expressed and resolved without trade interruptions. The Dialogue aligns with an important recommendation from the Canadian Agri-Food Trade Alliance’s February 2017 report, “Chasing China,” which says political and official interaction will have to increase “if trade between Canada and China is to expand and if the objective is a more predictable trading environment.”
“This agreement signals the start of a new relationship with Chinese importers based on cooperation to support mutually beneficial trade.”
In his presentation at the Dialogue, Jim Everson, president of the Canola Council of Canada (CCC), talked about standards and regulations in Canada. He mentioned the CCC’s Keep It Clean program to ensure
Canada’s canola exports meet food standards in China and all other markets. He talked about the importance of science-based regulations for Canadian and Chinese consumers. The bottom line is that Canadian canola is a safe and healthy product, and scientific studies prove this. “And stable and open trade in canola means a healthier cooking oil for China,” Everson says.
As part of the Dialogue, Everson and Bian signed a Memorandum of Understanding (MOU) between the CCC and CFNA. The MOU includes provisions such as communicating on regulations affecting trade and working together to facilitate industry meetings and exchanges.
“This agreement signals the start of a new relationship with Chinese importers based on cooperation to support mutually beneficial trade,” says Everson. While the Dialogue did include different positions on various potential trade issues, at the end of the day China and Canada have the same interest – and that is to trade in a high-quality oilseed product that Canada produces and China needs.
