Canada’s agriculture sector could be losing one of its best international customers.
Driving the news: Chinese tariffs on $3.7 billion worth of Canadian agricultural products came into <a href="https://www.theglobeandmail.com/world/article-chinese-tariffs-come-into-force-on-37-billion-worth-of-canadian-goods/">effect yesterday</a>, including 100% tariffs on canola oil and canola meal — finely ground-up seed that’s often used to feed livestock. The levy is a direct retaliation for the <a href="https://www.cbc.ca/news/politics/trudeau-halifax-tariffs-china-evs-1.7304773">tariff</a> that Ottawa slapped on Chinese-made EVs last year.
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<li>Ironically, it was the U.S. — the other country that Canada is in a trade war with — that <a href="https://globalnews.ca/news/10787673/canada-tariffs-chinese-evs/">championed the push</a> among its allies to hit Chinese EVs with tariffs.</li>
</ul>
Why it matters: China is Canada’s second-largest market for canola products, trailing only the U.S. With the Americans slated to hit Canadian products, including canola, with a 25% tariff in April, the industry is now facing potentially <a href="https://www.cbc.ca/news/canada/calgary/prairie-canola-tariffs-china-producers-brace-1.7488161">existential</a> threats in its biggest markets.
<ul>
<li>Canada exported <a href="https://www.canolacouncil.org/markets-stats/top-markets/">$7.7 billion</a> and <a href="https://www.canolacouncil.org/markets-stats/top-markets/">$4.9 billion</a> worth of canola products to the U.S. and China, respectively, in 2024. The rest of Canada’s top 20 international canola buyers imported less than $2 billion worth of products combined.</li>
<li>While canola seed itself is currently exempted from China’s tariffs, other products will be hit hard. Canada sold <a href="https://www.theglobeandmail.com/world/article-chinese-tariffs-come-into-force-on-37-billion-worth-of-canadian-goods/">$1 billion</a> worth of canola oil and meal to China alone last year.</li>
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What’s next: Farmers and industry groups are asking the feds to help <a href="https://www.cbc.ca/news/canada/calgary/prairie-canola-tariffs-china-producers-brace-1.7488161">cover the losses</a> they expect from the tariffs, arguing that they’re the ones paying the price for a policy designed to protect Canada’s auto industry.—LA
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Canada’s agriculture sector could be losing one of its best international customers as a result of tariffs from China.