Canada has secured continued access to its top canola market.
China agreed to extend a temporary arrangement allowing canola shipments infected with blackleg disease to be processed at five crushing plants located outside of the country’s rapeseed growing regions.
“This is tremendous news for our canola producers and processors and is a testament to our strong and collaborative working relationship with China,” said federal agriculture minister Gerry Ritz.
Canola Council of Canada president JoAnne Buth praised the federal government and the Chinese for coming to terms.
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“We welcome China’s commitment to work in partnership to maintain trade in canola while jointly tackling research to reduce the threat of blackleg,” she said.
The new arrangement is slightly different than the one agreed to in June 2010.
“It doesn’t have an end date on it. The end point on it is essentially when we complete the research that we’ve agreed to do,” said Buth.
The council has initiated a series of research projects designed to determine the risk of blackleg in a Canadian canola shipment contaminating a Chinese rapeseed crop.
Scientists will measure blackleg levels on canola seed and dockage, identifying whether spores are released during transport and unloading and providing recommendations on how Canadian growers can best manage the disease.
“We’re quite hopeful that the research results will show that there really is very little risk from Canadian
canola seed going to China for processing,” said Buth.
It took several months to get Chinese regulators to agree to the research program. Buth anticipates the projects won’t be complete until early 2013, which means two more years of restricted access to the Chinese marketplace.
The good news is that two crushing facilities are expected to be added to the list of approved plants, including Viterra’s new facility in the province of Guangxi in south China.
Buth said adding those plants will give Canada three million tonnes of access, up from 2.1 million tonnes.
“That is really good because the highest that we shipped a couple of years ago was 2.8 million tonnes.”
Canadian exporters have shipped a mere 692,000 tonnes of canola to China through the first 10 months of the 2010-11 crop year.
Buth said that is because China has been releasing a lot of canola oil from its state reserves into the market to help keep oil prices low for its citizens.
“As they’ve done that of course the crush margins have crashed.”
Sales of Canadian canola oil to China are up. In the first 10 months of the crop year, Canada shipped 626,856 tonnes of canola oil to China, up from 449,096 in the same period last year, an increase of 40 percent.
