China was the canola industry’s most valued customer last year, despite its lingering market access restrictions.
The country bought $1.8 billion worth of seed, oil and meal, making it the top buyer of Canadian canola products, the Canola Council of Canada said in an online presentation of its 2010 annual report.
China achieved the designation despite continuing restrictions on where imported seed can be processed because of concerns over blackleg disease.
The U.S. Department of Agriculture’s Foreign Agriculture Service said in a recent report that it believes China and Canada will resolve the blackleg dispute in the 2011-12 marketing year.
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Canola council president JoAnne Buth didn’t sound as optimistic during the presentation.
“We knew when this issue arose that this would be a long-term issue that we would need to deal with,” she said.
“We’ve started some joint research with China.”
Buth said 2010 was another strong year for canola consumption, with the crop generating $5.6 billion in farm cash receipts.
The United States took second spot on the buyer list, consuming $1.5 billion worth of products. It was by far the largest market for canola oil and meal, importing 1.05 and 1.14 million tonnes of those two products, respectively.
“The United States is a powerhouse market for us,” said Buth.
Japan came in third, accounting for $1 billion worth of sales. The country imported 2.01 million tonnes of seed, which ranked second behind China’s 2.25 million tonnes.
“Japan is our most consistent seed customer and has been for many years,” said Buth.
It is too early to assess how the recent earthquake and tsunami in that country will affect future seed sales.
Mexico bought $700 million of seed and meal, making it Canada’s fourth largest canola customer. The country has a growing appetite for healthier oil because of high rates of cardiac disease, diabetes and obesity.
Crushers also found a domestic market for $610 million worth of oil and meal.
Other important customers included the United Arab Emirates, Pakistan, Bangladesh and South Korea.
India didn’t make the list.
Buth said the country, which is a major importer of agricultural products, remains a “market of interest” due to its rapidly expanding middle class.
“We have started a small promotional program in India,” she said.
“We see it as a great opportunity for the future but it may take awhile.”
Two Indian companies are importing Canadian canola oil. One of them was featured in a recent article in the Financial Express, a newspaper from Bangladesh.
The chief executive officer for Jivo Wellness Canola Oil said edible oil demand will reach 21.3 million tonnes in India by 2015, up from 15 million tonnes in 2010.
The country is a big consumer of palm, soybean and groundnut oil, but the company believes there will be an expanding market for healthy canola oil. It is building three bottling plants over the next two years to meet that demand.
Jivo Wellness said it is hoping to increase canola production in India to reduce its reliance on imported oil from Canada.
Buth said the salmonella contamination issue that disrupted meal sales to the U.S. forced the industry to find new markets in Southeast Asia.
China also began buying canola meal for the first time late last year, importing 430,000 tonnes. She said only one Canadian crushing plant remains on the U.S. import alert list.
