This week China imposed a 75.8-per-cent tariff on Canadian canola seed, adding to its 100 per cent tariff on Canadian canola oil imposed in March.
After a one-year anti-dumping probe. China’s Ministry of Commerce argued that Canada’s canola sector has benefited from extensive government subsidies and preferential policies that distort markets.
In 2024, 23 per cent of the feedstock used to create a key clean fuel – renewable diesel – was used cooking oil.
The used oil is classified as less carbon-intensive under Canada’s clean-fuel regulations than canola oil, driving producers to use the feedstock.
Investigations from the United States and European Union suggest used cooking oil – largely sourced from Asia – might contain palm oil, a product tied to deforestation.
Ottawa therefore needs to rethink how it treats imports of used vegetable oil, said Chris Davison, president and chief executive officer of the Canola Council of Canada.
The timing has rarely been more pressing, said Chris Vervaet, executive director at the Canadian Oilseed Processors Association.
A policy to curb imports of used cooking oil so canola seed could capture just half of the market would use 2.5 million tonnes of canola seed, 42 per cent of the total volume exported to China in 2024.
“Used vegetable oil is really eating the lunch of the canola industry,” Mr. Vervaet said. “But we can be the masters of our own destiny.”
The Clean Fuel Regulations came into force in 2023 and have driven substantial investment in the canola industry, Mr. Vervaet said.
There has been a boom in canola processing capacity since 2021. Richardson International Ltd., Cargill and Louis Dreyfus Co. have invested approximately $ 2 billion in canola crushing.
By 2026, Canada will have the crush capacity to process 75 per cent of the canola crop grown in the country, he said. The three newest plants alone will have the ability to process 3.5 million tonnes of canola seed, he said.
