Major Canadian canola exporter to China says finding new markets not easy

Major Canadian canola exporter to China says finding new markets not easy
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OTTAWA — The head of one of Canada’s biggest exporters of canola seed to China warned Tuesday that if the Asian country’s ban on Canadian firms drags on that finding new markets for the product “will not be a painless exercise.”

Curt Vossen of Richardson International Ltd. made the comment Tuesday to a parliamentary committee studying an escalating trade dispute that has seen China suspend his company’s licence and that of another major exporter, Viterra Inc., over pest concerns.

A third Canadian firm has also received a non-compliance notice from China, although there’s no confirmation its permit has been revoked, federal Agriculture Minister Marie-Claude Bibeau confirmed later Tuesday.

China’s moves to choke off Canadian canola seed imports have been widely viewed as the superpower applying economic pressure on Canada following the December arrest of senior Huawei executive Meng Wanzhou in Vancouver at the behest of the United States.

Chinese buyers remain unwilling to buy Canadian canola seed, and Vossen said he cannot emphasize enough the importance of finding a solution to the feud — and quickly.

“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,” said Vossen, who’s CEO of the Winnipeg-based company that’s been doing business with China for more than 100 years.

“While we are confident that we can eventually find other markets, it will not be a painless exercise.”

Canola is a critical export for Canada — and China is its top market.

China imported $2.7 billion worth of Canadian canola seed last year, which ensures any prolonged feud would be felt by farmers, the industry and the broader economy. The seeds are the raw material for canola oil, which is widely used for cooking and in some industries.

Vossen said canola products alone were just over 15 per cent of all of Canada’s exports to China and, last year, were worth more than $4 billion.

As the federal government searches for a solution to the Chinese dispute, it’s been trying to find new markets and cabinet ministers have been touting Canada’s recently ratified trade deals with the Asia-Pacific region and the European Union.

Bibeau told another House of Commons committee Tuesday that the government has been informed that China issued a non-compliance notification to a third company, like the ones it sent to Richardson and Viterra.

“But at this time I’m not allowed to share the details on this,” said Bibeau, who appeared alongside International Trade Minister Jim Carr. “It doesn’t mean that they’re suspended, either, at this time. So, we will obviously keep working with them and see how it goes.”

The Liberal government has insisted it wants to find a scientific solution to the dispute and Bibeau has said she sent a letter to her Chinese counterpart with a request to send a delegation of experts to China to examine the issue. Officials are examining options to support farmers through the possible expansion of existing programs, Bibeau said.

The federal Liberals have also established a working group that includes officials from Richardson, Viterra and representatives from the governments of Alberta, Manitoba and Saskatchewan.

On March 1, the same day China suspended Richardson’s licence, Canada’s Justice Department gave the go-ahead for the extradition case against Meng.

It marked the formal start of the high-profile process that has thrust Canada into a highly uncomfortable position between China and the U.S.

In the days following Meng’s arrest, China arrested Canadian citizens Michael Kovrig, a Canadian diplomat on leave, and Michael Spavor, an entrepreneur, on allegations of engaging in activities that have endangered Chinese national security.

Vossen urged the federal government to be “more aggressive” in defending the interests of Canada’s agriculture exporters in China and around the world, where they’re facing trade barriers in several jurisdictions.

“To say that canola is important to Canada’s trading relationship with China would be a gross understatement — canola and, indeed, the entire grains and oilseeds complex is the foundation of Canada’s trading relationship with China,” he said, noting the disruption comes at a critical time right before seeding season, when farmers are deciding how much to grow.

—Follow @AndyBlatchford on Twitter

Andy Blatchford, The Canadian Press

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