Should they plant or not? Canola farmers in Canada’s extensive Western Prairie regions find themselves caught in the midst of trade conflicts with both the United States and China.
"Simultaneously, we're witnessing a trade conflict involving two major global economic powers against us," said Rick White, who leads the Canadian Canola Growers Association, to AFP.
We have faced difficulties before, but none on this scale. This situation is the most severe we've encountered," he stated just weeks prior to the start of planting.
As a significant agricultural nation, Canada ranks high globally as one of the leading producers of canola—an oilseed utilized for making edible oils, feed for livestock, and biofuel.
However, the majority of canola exports are sent to only two nations: the United States and China—both of which have tense trade relationships with Canada due to tariff disputes.
Recently, Beijing declared 100 percent tariffs on canola oil and meal as a reaction to Ottawa’s duties on Chinese electric vehicles, measures that mirror those applied to China by the U.S. during President Joe Biden's tenure.
Since taking office in January, U.S. President Donald Trump has threatened broad-ranging tariffs on imported Canadian products entering the United States.
The cost of canola has dropped due to Chinese tariffs, which has also caused the price of European rapeseed to fall.
Seeding soon
Jason Johnson, a farmer hailing from Manitoba province, which lies within Canada's fertile farming region, asserts that all these issues need to be resolved in the upcoming weeks.
"He mentioned they will start planting in roughly a month, adding that once this process begins, changing the crop type won’t be an option," as he awaited a callback from a seed supplier regarding potential alternatives.
Nearly one-third of Canada's canola exports go to China, primarily consisting of canola seeds, whereas the United States represents the biggest consumer of canola oil and meal.
Johnson thinks that it was incorrect for Canada to enforce tariffs on China.
"We ought to return to China and propose, ‘We will reduce our tariffs if you do the same,’ essentially mimicking Trump’s approach by using tariff threats and subsequently withdrawing them," he said to AFP.
On his sprawling 2,500-acre property situated close to the Canadian-American boundary, approximately 1,000 acres are dedicated annually to cultivating canola. He strongly believes that the U.S. will escalate tariffs against Canada, which could result in broad and severe impacts.
These tariff threats have already reverberated across Canada since over three-quarters of its exports are destined for the United States. Should a trade conflict erupt between these neighboring countries, with Canada hitting back, it could inflict considerable harm on the Canadian economy.
'Engage with China'
The head of the Canola Council of Canada, CEO Chris Davison, is appealing to the Canadian government to "quickly initiate discussions with China aimed at addressing this matter."
Ottawa and Beijing have had tense relations for several years, with tensions escalating when Canada arrested a high-ranking Huawei official on a U.S. extradition request in December 2018, prompting China to detain two Canadian citizens in response.
An agreement was made resulting in the release of all three detainees in September 2021; however, tensions persist. Beijing has criticized Ottawa for endorsing Washington’s stance on China policy, while Canadian officials frequently accuse China of meddling.
As this continues, Canadians ponder whether vibrant yellow fields of canola will grace the Prairie landscapes this coming spring.
Johnson states that changing from canola to different crops at short notice would not be simple.
The markets for other crops are generally smaller. If canola farmers were to shift towards growing these alternative crops, it could result in an overabundance and subsequent price decline for those agricultural products as well.
He pointed out as well that Canada has "spent considerable resources over the past two decades on developing infrastructure" for pressing canola into oil and meal.
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