Canada, China talking to keep canola seed exports moving

OTTAWA/BEIJING (Reuters) - Canada and China are in talks to ensure limited Canadian canola seed exports continue even as a year-long trade dispute remained.

FILE PHOTO: A deer feeds in a western Canadian canola field which are in full bloom this week before it will be harvested later this summer in rural Alberta, Canada July 23, 2019. REUTERS/Todd Korol/File Photo

Beijing blocked canola seed shipments from Richardson International and Viterra Inc last year, citing pest concerns. China’s move came after Canada’s detention of a top Huawei Technologies Co Ltd executive.

Canadian canola seed shipments from other companies to China have continued but were in jeopardy due to the March 31 expiration of an agreed standard on the amount of foreign material allowed per shipment.

Officials from China’s customs administration and Canada’s farm ministry spoke on Tuesday, two sources said.

No contracts between Canadian canola exporters and Chinese buyers have been signed in the past two to three weeks, a Canadian government source said on Tuesday, as industry participants waited to hear whether a new standard could be reached.

“We’ve seen promising signs of positive relations on specific issues,” Canadian Prime Minister Justin Trudeau told reporters on Tuesday, asked about progress on canola trade with China. “We’re going to continue working to try and ensure that our farmers, our manufacturers, our exporters, continue to have access to the markets around the world even in this difficult time.”

While Chinese sources have suggested that all canola seed imports would resume, a Canadian government source said that no agreement had been reached to allow the top two exporters back into the market.

Discussions between Canadian and Chinese officials continue, the source said. Chinese authorities have indicated Canadian canola seed shipments may continue to be shipped provided the amount of foreign material is limited to less than 1% of the shipment, the source said.

Richardson and Viterra continue to be blocked from exporting canola seed to China.

Richardson spokesman Jean-Marc Ruest said the company had no details about recent Canada-China discussions. Viterra spokesman Peter Flengeris could not immediately comment.

Canola, like soybeans, is crushed into protein-rich meal for animal feed and Canada is the world’s top supplier. ICE canola futures edged higher on Tuesday.

China’s General Administration of Customs was unavailable for comment after office hours. Canadian Agriculture Minister Marie-Claude Bibeau did not immediately comment.

China’s oilseed processors have struggled with the lowest soybean stocks since at least 2010, as the coronavirus pandemic disrupts the global supply chain of farm produce.

“The market is worried about oilseed supplies. And there is no energy left for any (trade) fights now,” said another source with a major agriculture products importer.

Reporting by Kelsey Johnson in Ottawa, Hallie Gu and Dominique Patton; Additional reporting by Rod Nickel in Winnipeg; Editing by Jason Neely, Bernadette Baum and Alison Williams