Saskatchewan Premier Scott Moe says that while the talks with China will be important to building relationships, a solution must ultimately come from Ottawa.Liam Richards/The Canadian Press
Saskatchewan Premier Scott Moe will be joined by Mark Carney’s parliamentary secretary on his trade mission to China, in a joint push to have Beijing end its punishing tariffs on Canadian canola seed.
Kody Blois will join Mr. Moe for talks in China from Sept. 6 to 9. The Premier’s trade mission, while focused primarily on ending the 75.8-per-cent duties imposed on canola seed imports mid-August, will also focus on South Korea and Japan, part of an effort to expand export opportunities for Saskatchewan products.
The canola talks between Chinese officials and industry stakeholders will be important to building relationships and hastening a solution that ultimately must come from Ottawa, said Mr. Moe at a press conference Thursday.
“It isn’t going to be myself – the Premier of Saskatchewan – and the President of China that are going to stand up at the end of the mission and say we have signed a deal. It needs to be the Prime Minister of Canada.”
The mission will also address Chinese tariffs on other products, including peas, pork and seafood, Mr. Moe said.
But the clock is ticking for Canadian canola.
Ottawa wants certainty from China before making concessions on canola tariffs, minister says
China’s duty on canola seed has cost 40,000 canola farmers across Western Canada tens of thousands of dollars each as prices fluctuate and respond to the loss of the sector’s second-largest, $4.9-billion market. And a number of farmers will now need to accept these deflated prices as harvest gets under way.
The duties – currently preliminary and collected as a deposit – could also take more permanent form if the trade dispute is not resolved before China concludes its anti-dumping probe, the impetus for Beijing’s actions. (China’s 2019 ban on Canadian canola shipments lasted three years.)
However, Mr. Moe stressed the importance of “navigating carefully” in this trade dispute, which has put canola in a difficult position between the industry’s two largest markets: the U.S. and China.
Parliamentary secretary Kody Blois will join Mr. Moe for the talks.Sean Kilpatrick/The Canadian Press
While China has justified its duty on claims that Canada’s canola industry receives extensive government subsidies and preferential policies, Canadian farmers and industry associations says Beijing’s actions are politically motivated.
Beijing’s duties last month were levied shortly after Ottawa imposed steel tariffs on China as a way to protect Canada’s industry after the U.S. imposed steel duties on this country in July.
Previously, Ottawa’s decision last year to impose 100-per-cent tariffs on Chinese-made electric vehicles resulted in Beijing imposing 100-per-cent retaliatory tariffs on canola meal and oil in March, alongside tariffs on pork, peas and seafood. Ottawa’s tariffs on EVs were applied at the behest of the Biden administration and to protect Canada’s nascent sector.
The canola industry has therefore called for a political solution to the political problem.
However, this will be hard to do, said Mr. Moe, stressing the uncertainty of the U.S. market.
Opinion: China’s canola tariffs are a dangerous trap
One specific uncertainty facing canola exports to the U.S. – alongside broader concerns about a trade deal – are plans put forward by the U.S. Environmental Protection Agency in June.
A large share of the $7.7-billion demand for Canadian canola is driven by the biofuels industry, which uses the crop as a feedstock in the production of highly incentivized clean fuels.
The proposed changes would slash the credit value of fuel made using imported feedstock by 50 per cent and would make Canadian canola farmers and processors uncompetitive, The Globe and Mail reported Monday.
Canada’s canola industry is asking the U.S. environmental agency for an exemption.
This dual trade uncertainty with the two largest markets is the “most significant” challenge faced by canola in recent history, and is more reason to diversify trade, Mr. Moe said.
Saskatchewan Minister of Trade and Export Development Warren Kaeding will visit South Korea while Mr. Moe is in China. They will both go to Japan for the final leg of the trade mission.
“As global trade patterns are shifting – and we’re seeing that on virtually a daily basis – there are new opportunities for our products in Saskatchewan to gain market share in many markets around the world,” Mr. Moe said.