Farmers pay the price as Chinese canola market remains off-limits

By Cal Braid
Taber Times
Local Journalism Initiative Reporter

 In early September, the Canadian Canola Growers Association (CCGA) said the canola industry was let down by the federal government’s support measures in response to the closure of the Chinese market to Canadian canola seed, oil, and meal.

 Ottawa announced $370 million in new support for the Canadian canola sector, which faces prohibitive tariffs from their second-most lucrative market. However, the $370M to the canola sector is in reality a biofuel production incentive that leaves many growers unsatisfied. Ottawa additionally increased interest-free loan limits for canola producers to $500,000.

 Chris Davison, Canola Council of Canada (CCC) president, said the government measures “do not reflect the seriousness of the challenge facing the value chain.”

 A temporary doubling of the interest-free portion for canola advances under the Advance Payments Program (APP) went into effect. The APP is a federal loan program administered by CCGA in Western Canada, and it began issuing cash advances at the new limits on Sept. 16.

 For 2025, farmers can apply for up to $1 million in financing, with up to $500,000 interest-free, and the remaining at CCGA’s interest-bearing rate of prime less 0.25 per cent.

 The massive trade disruption poses a serious challenge to southern Alberta canola growers. China is Canada’s second-largest market for canola, with exports valued at $4.9 billion in 2024, according to the CCGA. Canola seed accounts for roughly three-quarters of those exports.

 Christine McKee, director of Alberta Canola and a Lethbridge-area farmer, explained the gravity of the situation. “Southern Alberta farmers, and I would say farmers in Western Canada in general, their farms are largely profiting from canola. But you can’t grow canola on every acre or specialty crops everywhere – you have to have a rotation in your crops. So farmers grow the pulses and they grow the wheat, but canola is where we make our profit.”

 By September, she said that farmers had lost an estimated $1.5 billion across Canada. “It’s very, very bleak when you consider that canola is what a lot of farmers use to be profitable,” McKee said.

 In 2024, Canada’s exports to the US, its largest market, were valued at $7.7 billion. Exports to China were worth $4.9 billion, and the next three most significant markets – Japan, Mexico, and the European Union – were valued at a combined $1.6 billion.

 McKee explained that while the US is Canada’s biggest importer of canola, it mostly imports oil and meal. China, the second largest importer, imports mostly raw seed and crushes it themselves.

 “There are no other markets in the world that can replace the United States and China. They are, for sure, 90 per cent of our exports,” she said. In September, the CCGA called the Chinese market “effectively closed.”

 McKee said farmers are asking the government for more stable and predictable open trade agreements. They are asking it to do a much better job of working with other countries so that things like this don’t happen.

 “In the meantime, we are being severely financially punished because of this situation. They did a couple things: they increased the APP interest-free portion of the loans farmers can get, and then they have put forward $370 million to biodiesel companies.”

 “My take on that as a farmer is they gave the biodiesel corporations $370 million and they gave farmers more loans,” she said. “Yet, there’s no talk of a direct payment to farmers to compensate them.”

 Farm profits are already tight enough, McKee said, and she has seen statistics that show farm profitability as a negative number – before the tariffs were implemented.

 “My main message is that this was a government-caused problem,” she said. “It is directly affecting farmers financially, and they should step up and talk to us about compensation. They’re doing that to help those oil biodiesel companies stay profitable. Where’s the payment to help farmers to grow food for our country to stay profitable?”