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Canada pushing 'science' in canola dispute with China: Ag Minister Bibeau

Canada is asking China to provide proof of insect contamination in Canadian canola in the hope that "science" can solve the current trade dispute between the two countries, the new federal agriculture minister said Tuesday.

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Canada is asking China to provide proof of insect contamination in Canadian canola in the hope that “science” can solve the current trade dispute between the two countries, the new federal agriculture minister said Tuesday.

Speaking to the Calgary Chamber of Commerce, Marie-Claude Bibeau — who is making her first official visit to Western Canada this week since being sworn in as agriculture minister earlier this month — said the federal government stands with Prairie farmers affected by China’s suspension last week of canola shipments from Winnipeg-based Richardson International, one of the country’s largest grain exporters. Though China’s foreign ministry cited pest concerns as the reason, some have suggested the move was retaliation against the Canadian government for arresting Meng Wanzhou, a top executive at Chinese tech giant Huawei.

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“We are asking the Chinese officials to provide us with samples, or invite our scientists to go over there and look at the product. Because, obviously, if there is a problem, we want to know,” Bibeau said.

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Bibeau added the government is also considering “a wider range of actions” in response to the Chinese canola ban but declined to elaborate.

“For now, we are really focusing and still believe we can find a science-based solution,” she said.

China is the single largest export destination for Alberta canola, accounting for nearly half of global exports in 2018. Alberta — which has 14,000 canola farmers who sell five million tonnes of product per year — shipped nearly $800-million worth of canola to China last year, a fourfold increase from eight years ago.

Alberta is also home to four canola crushing plants as well as numerous grain elevators that move a lot of canola. Several large seed companies also operate production facilities in the province.

Last week, Premier Rachel Notley said Alberta farmers and Alberta workers stand to lose hundreds of millions of dollars and up to 3,000 jobs if the dispute is not resolved. Speaking to reporters, Bibeau acknowledged the seriousness of the situation.

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“If it would remain a problem for a longer time it could be a problem for jobs as well,” she said.

Storm clouds gather over a field of canola near Queenstown, Alta., on July 1, 2018.
Storm clouds gather over a field of canola near Queenstown, Alta., on July 1, 2018. Photo by Mike Drew/Postmedia

In an interview, Richardson International’s vice-president of corporate affairs, Jean-Marc Ruest, said it is too early to speculate about job losses as a result of the China situation. (In Alberta, Richardson operates a large processing facility at Lethbridge that employs 155 people).

“If it gets resolved quickly, then no significant impact with respect to jobs,” Ruest said. “If it’s not a quality issue, if it’s a wider issue . . . then who knows what the impact could be? We’re not planning at this point on job losses resulting from this but that doesn’t mean it’s not a serious issue.”

Beyond the immediate repercussions for the canola industry, the growing diplomatic tension between Canada and China is sending a chill through the entire agriculture sector. After the U.S., China is the second most important agricultural export market for Alberta, and many farm groups and businesses have worked hard in recent years to make inroads there.

Alberta-based Sunterra Group, for example, has been exporting a growing volume of pork to mainland China in recent years, but Sunterra Market president Glen Price said recent events — including China’s arrest and detention of a number of Canadian citizens — have temporarily halted his company’s efforts there.

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“For right now, we’re not sending our people into mainland China,” Price said. “I think it’s still very safe, but for the business that’s there — it’s a minor part of our business — it’s not worth it at this stage for the next few weeks at least.”

John Masswohl, director of government and international relations for the Canadian Cattlemen’s Association, said the value of Canadian beef exports to China has increased from just under $5 million in 2011 to $82 million last year, and the beef industry has been lobbying China to open its market further to different types of product and cuts. But he said since the arrest of Meng in December, there has been little forward movement.

“It’s not so much a pulling back, but that we haven’t seen the progress we’ve been hoping for,” Masswohl said. “Is that because of the current situation, or is that just the way it is? It’s hard to tell.”

Lethbridge Mayor Chris Spearman said he, along with the regional economic development authority and a number of local business leaders, went on a trade mission to China in 2017 in an effort to expand markets for southwest Alberta’s agricultural products. Lethbridge is a centre of agri-food processing (in addition to the Richardson canola crushing plant, the city is home to 23 other food processing plants) and the huge Chinese market was seen as a major opportunity.

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However, while Spearman said the trade mission was deemed a success and resulted in a number of visits to Lethbridge by representatives of Chinese businesses, efforts to grow those connections in recent months have “stalled.” He said the ongoing diplomatic tensions make it appear Canada won’t be signing a free-trade agreement with the Chinese anytime soon.

“It is certainly a challenge and puts us at a disadvantage,” Spearman said. “(China) is a huge opportunity for Canadian exporters, a great market, but it probably won’t happen in the near future.”

Bibeau said while the situation with China is ongoing, the federal government will continue to promote the quality of Canadian agricultural products in other markets, particularly new ones that have just opened as a result of Canada’s signing of the Trans-Pacific Partnership trade deal.

“Depending too much on one country or another always makes us more vulnerable,” Bibeau said. “We have very high quality products that we export, and I really intend to make sure that this brand, this Canadian brand of high quality, is protected.”

astephenson@postmedia.com

Twitter.com/AmandaMsteph

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