Canada’s genetically modified flax incident is having a chill effect on canola exports to Europe.
Exporters regained access to the European Union last year when the last of a long list of canola traits gained final EU regulatory approval.
But one trait was left off the list because canola industry officials felt it would show up in the handling system periodically at such low levels that it wouldn’t pose any trade risk.
The trait is Westar-Oxy-235, abromoxynil tolerant canola developed by Rhone-Poulenc Canada Inc. and commercialized for a couple of years in the early 2000s.
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In the wake of Europe refusing U.S. soybean shipments contaminated with dust from an unapproved GM corn event and Canadian flax trade being shut down due to trace amounts of a long deregistered GM flax variety, Canadian canola exporters are anxious about Westar-Oxy-235.
“It makes everybody very, very diligent and very concerned about what might happen,” said Canola Council of Canada president JoAnne Buth.
Some exporters have taken the risk. During the first eight months of the crop year, they shipped 95,000 tonnes of canola to Europe, all of it going to Portugal.
Europe has a growing need for rapeseed and canola imports to fuel its expanding biodiesel industry.
The United States Department of Agriculture’s Foreign Agricultural Service estimates EU-27 rapeseed production will decline by 340,000 tonnes in 2010-11, despite a six percent hike in seeded area.
“It is unlikely that the record yields of 2009 will be reproduced and yields are expected to return to more average yields,” said the agency in a recent EU-27 oilseeds outlook report.
Oil World thinks the decline will be greater. The forecasting service is calling for a 670,000 tonne drop in production from 2009-10 levels due to dry conditions in parts of Europe.
That will contribute to the growing gap between rapeseed consumption and production in Europe. The USDA predicts the gap will widen to 2.85 million tonnes in 2010-11, up from 2.35 million tonnes the previous crop year.
Europe is expected to import 2.8 million tonnes of rapeseed/canola in 2010-11, which is considerably higher than the average of 2000-01 through 2007-08, when imports ranged from 55,000 to 687,000 tonnes.
Buth said most of Canada’s trade with Europe will come in oil exports from some of the new crush facilities in Western Canada and from seed sent to Dubai that will be crushed into oil heading for the EU biodiesel market.
The canola industry is not seeking regulatory approval for Westar-Oxy-235.
Instead, it is pushing Europe to adopt a low level presence threshold for discontinued GM traits.
“We need some way to get recognition that these are not safety issues,” said Buth.
