South Korea is the third biggest market for Canadian canola oil exports, and the country of 50 million people could be in a position to buy even more. The Canada-Korea Free Trade Agreement was signed in 2015, and since then South Korean tariffs on Canadian canola have been coming down step by step. On January 1, 2021, the tariff on crude canola oil was eliminated, meaning that South Korea no longer has any tariffs on Canadian canola products.
“Removal of the balance of the tariff continues to elevate South Korea as an extremely valuable trading partner for Canadian canola,” says Jeff Pleskach, merchandising manager for Cargill and Canola Council of Canada (CCC) board director.
To build on this potential, the CCC had planned to host a Korean delegation for a Canadian canola tour in 2020, but the pandemic made that impossible. So the CCC worked on the next best option – a virtual tour. The mission was carried out by the CCC with funding support provided by Agriculture and Agri-Food Canada. The agenda was condensed into two hours, with presentations in English with Korean translation.
“Continuing to connect with our global customers during this pandemic has been important to our industry. The desire to stay connected and share information comes from both sides, and this was reflected in the participation and engagement during the session.”
It was an engaging session with representatives from four South Korea companies that either currently purchase or are interested in purchasing canola oil from Canada. These companies showed enthusiasm to gain more information on canola quality, reliable supply and the industry’s plans for growth.
The agenda included presentations on canola production and processing from Pleskach and fellow CCC board member Ryan Law, who is the canola commercial manager with Bunge. Shaunda Durance-Tod, CanolaInfo manager, talked about the health and functional benefits of canola oil, mentioning its very low saturated fat content and high functionality in restaurant fryers and processed food. Clint Jurke, CCC agronomy director, talked about Canadian canola industry goals to produce an ecologically sustainable crop by improving soil and water quality, reducing greenhouse gas emissions and increasing biodiversity. CCC board chair Charlene Bradley, who is also a director SaskCanola, and Nicolea Dow, Manitoba Canola Growers director, provided the farm perspectives.
Xuguang Huang, Canada’s Trade Commissioner in South Korea, also participated. “The best way to grow the business for Canadian canola in Korea is to develop new channels for the use of canola oil,” Huang says, adding that the food service industry and the biofuels sector may be potential growth areas. He gave one specific example. “I’d like to see more food service companies using canola oil for fried chicken, which is a very popular food in South Korea.”
Some of the Korean participants asked how canola oil could be more competitive in terms of price. Pleskach answered: “Canola oil tends to be at the higher end of the range given the value it provides,” he says. “The goal in South Korea is to unlock that value.”
When asked why is it important for farmers to always keep in mind their customers, like the processors and consumers in South Korea, Nicolea Dow answered: “One of the greatest challenges canola farmers had over the past few years was profitability, which was related to global market access. For our business and our ability to make a profit, it is extremely important to meet the demands of our export markets.”
Jim Everson, president of the CCC, remarked on the virtual trade missions. “Continuing to connect with our global customers during this pandemic has been important to our industry. The desire to stay connected and share information comes from both sides, and this was reflected in the participation and engagement during the session.”
While face to face meetings allow for a more in-depth experience for our customers, the virtual trade mission did work to keep the conversation going in the midst of pandemic-related travel restrictions. When this pandemic is over, we will probably see a combination of virtual and in-person missions to share the benefits of our safe and healthy canola products and Canada’s world-class canola supply chain.