Canola council mum on dockage deal

Since this story went to print the Canola Council of Canada has released a statement. You can find that press release here.

The canola industry response to news of a reprieve in its dockage dispute with China has been muted.

The Canadian government announced last week it had signed a memorandum of understanding with China to allow trade to continue unabated through 2020.

China was threatening to implement a new policy on Sept. 1, requiring less than one percent dockage in canola shipments. Current trade practices allow for up to 2.5 percent dockage.

Exporters claimed the policy would seriously disrupt $2 billion in canola seed sales to China.

The new agreement delays implementation of China’s proposed policy for four years while the two parties conduct additional research on how much of a threat dockage poses to China’s rapeseed crop.

China worries dockage could lead to the introduction of blackleg disease.

The Canadian government trumpeted the agreement as a major breakthrough in the long-running trade dispute with China.

“This is great news,” said Prime Minister Justin Trudeau.

“Our progress on this file goes to show how two countries can collaborate, can solve difficult challenges together.”

Chrystia Freeland, minister of international trade, said she was thrilled to witness the signing of the memorandum.

“This new agreement on canola will help Canadian farmers and producers, their families and the middle class by providing stable and predictable conditions for years to come,” she said in a news release.

The Canola Council of Canada was noticeably silent concerning the agreement. It did not issue a news release and was not mentioned in the government news release.

That is unusual given that the council had issued news releases in March when China agreed to postpone the policy implementation date to Sept. 1 from April 1 and in August when the two sides announced a solution was days or weeks away.

Brian Innes, vice-president of government relations with the council, said the council would not comment on the memorandum until it had further details of what was contained in the pact.

The council had been pushing for a permanent resolution to the issue. Instead, there are going to be more research projects and a lingering potential trade issue with Canada’s top canola customer.

John Duvenaud, publisher of Wild Oats Grain Market Advisory, was nowhere near as excited as the government was about the memorandum.

“I think there was a lot of excitement raised over an issue that is totally peripheral to whether trade happens or not,” he said.

Duvenaud contends Canada’s canola exporters are capable of shipping canola with less than one percent dockage. A number of grain companies had already agreed to shipments meeting those specifications.

“I don’t think it was a deal-breaker at any point. It was always, and continues to be, an achievable standard,” he said.

Duvenaud can’t understand why the government got involved in the dispute in the first place.

“Whatever happened to the idea that the customer is right? If they want one percent dock, give them one percent dock,” he said.


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