China’s decision to turn its back on Canadian canola may have some central Alberta farmers rotating their crops this spring to reduce the impact of losing Canada’s top canola customer.
Canola Council of Canada say Chinese importers have stopped buying Canadian canola. It all began earlier in March when China blocked imports from Canada’s largest grain producers Richardson International Ltd. for alleged detection of hazardous organisms in its product. Speculation is that it’s in retaliation for Canada’s arrest of a top Chinese tech executive, Meng Wanzhou of Huawei Technologies Co. Inc., at the behest of the United States in December.
Sylvan Lake-area canola farmer Mike Ammerter, who is also a board director with the Alberta Canola Producers Commission, said there’s likely some angst among farmers.
“We feel a bit stuck. If you have canola in your bins that’s not sold, that’s a direct hit to your pocketbook. Canola prices have dropped because of this uncertainty,” said Ammerter on Monday.
Nervous farmers may shift a portion of their crops away from canola as part of their crop rotations, he said.
“I don’t think it will be a huge swing. It’s still a profitable crop. They may do some tweaking,” said Ammerter, adding that farmers will be in the fields seeding in about a month.
Typically canola has been grown on a minimum of one/third of crop land in the Red Deer area, he said.
“Personally, I don’t think I’ll make a whole lot of changes. This in not a good news story, but farmers are typically optimistic. I guess I fall in that category.”
He said hopefully the issue will be resolved by harvest time. A lot can happen in a few months.
“As a producer, I think we just have to trust our system. Hopefully that will prevail. We have customers globally we deal with and there doesn’t seem to be any issues. They value our product. We have a high quality product. It could lead to a good relationship with someone else.”
About 40 per cent of Canadian canola has generally gone to China.
Ammerter said the dispute does have a déjà vu quality for Western Canadian farmers. About a year and a half ago, India introduced tariffs on Canadian pulses that caused the price of peas for dràp dramatically.
“You can have stuff pop out of the blue. Nobody sees it coming. You just have to do your best to deal with it.”
He said canola is a key fit for central Alberta farmers, but the region has a good climate for most grain crops.
— with files from The Canadian Press