MarketsFarm — The Canola Council of Canada (CCC) and the Canadian Canola Growers Association (CCGA) have given farmers an update on the current situation between Canada and China.
The 38-minute joint webinar/teleconference last Thursday (April 18) featured CCC president Jim Everson and CCGA executive director Rick White.
Everson made it clear China is still honouring any outstanding canola contracts and continues to import canola oil and meal.
“Producers can still make deliveries to exporters,” Everson said. “Unfortunately the importers (in China) are not interested in transacting new contracts.”
China last month announced Richardson International and Viterra were prohibited from shipping canola to the country, whose authorities claimed the shipments were contaminated.
“China has every right, with the way the rules of sanitary measures are laid out…to raise issues, related to the quality of the products coming into their country,” Everson explained, adding China also needs to discuss its findings with the Canadian Food Inspection Agency (CFIA).
After inspecting those canola shipments multiple times, CFIA has not found the contaminants Chinese officials have claimed. The federal government wants to send a technical delegation to China to discuss the matter.
Everson and White expressed their confidence in the quality of the canola Canada exports globally.
The previously-announced Canola Working Group has also been set up and is comprised of senior officials from the federal government, the three Prairie provinces, industry experts and producers. The group has met a number of times, said White.
“The (federal) government is hearing us loud and clear as an industry. They are very in touch with the severity of the issue and risk and uncertainty that farmers in particular are facing,” he commented.
Although no decisions have yet to be made on how to assist farmers, White said there are some options on the table. One is enhancing the advance payments program by possibly expanding the interest rate component.
“This kind of disruption is exactly what the program is designed for,” he said, adding the measures won’t fix the situation but will assist growers over the next 18 months with their cash flow.
Another possibility is providing assistance for infrastructure, such as farmers increasing their storage capacity, White said.
The group is also looking at diversifying Canada’s canola exports as China, at 40 per cent, is its largest customer.
Canada wants to resolve the dispute with China peacefully and would only pursue retaliatory measures as a last resort, Everson said.
— Glen Hallick writes for MarketsFarm, a Glacier FarmMedia division specializing in grain and commodity market analysis and reporting.