As Canola Spat Steals Headlines, China Quietly Buys Canada Crops

(Bloomberg) -- As the very public China-Canada canola spat drags on, buyers from the Asian nation have been quietly purchasing other Canadian farm products.

Canada shipped 1.9 million metric tons of wheat to China in the crop year through June, up 92% from a year earlier, Canadian Grain Commission data show. Canola oil and meal have also been flowing into Chinese ports, albeit slightly lower volumes. Canola-seed shipments have slumped 22%.

Wheat imports have climbed as China’s options for high-protein grain have been reduced by drought in Australia and an escalating trade war with the U.S.

The wheat industry isn’t celebrating the increase though. China “has become a very uncertain market,” Cam Dahl, president of Cereals Canada, said by telephone. “Despite the volumes, it’s short-term contracts, and there’s nervousness and uncertainty both on the importing side as well as for the exporters.”

Canola-seed imports dropped off this year after China revoked Richardson International and Glencore Plc unit Viterra’s licenses in March, claiming pests were found in shipments.

Canola meal and oil exports to China had previously been on the rise for years as crush capacity has increased in Canada. Canola meal is used in Chinese dairy and aquaculture feeds, while canola oil is used for cooking.

Canola hasn’t been the only Canadian agricultural product affected. In June China halted Canadian meat imports after a forged inspection document was found on a pork shipment. And while the Canadian government has been working to restore imports by addressing China’s concerns, the ban is still in effect.

The Canadian Food Inspection Agency “continues to be in contact with Chinese authorities in order to resume trade with China as soon as possible,” Marie-Claude Bibeau, minister of agriculture and agri-food, said in an emailed response.

--With assistance from Millie Munshi.

To contact the reporter on this story: Ashley Robinson in Winnipeg (Non BLP Loc) at arobinson193@bloomberg.net

To contact the editors responsible for this story: James Attwood at jattwood3@bloomberg.net, Joe Ryan

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