Canadian canola has been going steady with Japan for years, but the industry would like to get more friendly with China, too.
That’s why canola industry officials are in Asia romancing potential customers.
“We’ve taken the major movers and shakers in the canola industry to China to meet with their counterparts and we’re very hopeful it will turn into a long-term process that will end up in … two million tonnes of seed and a million tonnes of oil (exports to China per year,)” said Canola Council of Canada spokesperson Dave Wilkins.
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Presently China is an on-again, off-again buyer of Canadian canola. In some years it has purchased more canola than Japan – Canada’s best offshore customer – but other years has bought virtually none.
“China will come to the market when it needs oil and it will buy based on price and availability.”
But the canola council would like China to become as dependable as Japan. Japan buys 1.6-1.8 million tonnes of canola seed per year and has never abandoned the market.
To keep the relationship strong, Japanese buyers and processors travel to Canada each summer to survey the Canadian crop and industry, and each December Canadian officials travel to Japan to update the Japanese on the exact size and quality of the new crop.
Wilkins said a good working relationship like the one with Japan would be helpful, but the Canadian industry also needs regulatory changes from China. Right now, canola imports are charged higher tariffs than soybeans, so buyers have a disincentive for buying canola as an oilseed.
“We want equalization of the tariffs,” said Wilkins.
The Canadian canola industry is following a “seven by seven” strategy so that huge markets like China can be reliably supplied each year. The phrase stands for the industry’s goal of producing at least seven million tonnes every year by the year 2007. In some years that amount has been produced, but Wilkins said that must become a minimum so canola marketers not only open new markets, but also keep them supplied every year.
“We need to do that so that we can go to the Mexicans and the Chinese and the Japanese and say ‘we will always have seven million tonnes and we will not disappoint you. We will always have canola for you,’ ” said Wilkins.
Canadian canola industry representatives are also going to visit Pakistan, which bought Canadian canola this year.
