China is standing firm on its insistence for higher standards of canola in negotiations with Canada, which shows the government’s determination to regulate the sector by encouraging domestic production of the crop, experts told the Global Times on Tuesday [16 August 2016]…Full Article: The Global Times Aug 2016

Key Points

  • On 1 September 2016, China will lower the extraneous plant material standard in canola/rapeseed imports from 2.5% to 1%. The lowering of extraneous plant material in shipments such as straw and other materials will increase the cost of business for Canadian exporters.
  • From 2015 to 2016, canola cultivation in Jiangsu Province reportedly declined from 467,000 hectares to approximately 200,000 ha. In Hubei Province, canola cultivation declined roughly 8%.

ChinaAg Comments

  • In 2015, canola/rapeseed import prices totaled approximately CNY 3,400 (~US$536) per MT while domestically produced rapeseed was valued at CNY 3,500 (US$546). Major Chinese rapeseed importers include Fujian, Guangdong, and Guangxi Zhuang.
  • In 2015, China withdrew price subsidy support for its canola/rapeseed farmers just after the planting season.
  • In early August 2015, China’s State Administration of Grain (SAG) stated that its top nine provincial planting regions only bought 1.02 million MTs of rapeseed, a decline from the roughly 2 million MTs typically purchased by August.
  • From 2013 to 2014, mainland Chinese imports of Canadian canola/rapeseed increased from 2.7 million MTs to 4.5 million MTs.
  • In 2014, Chinese subsidized domestic prices of canola were above CNY 5,100 (~US$828) per MT, which is 40% higher than foreign imports (including shipping and taxes).
  • From 2008 to 2014, rapeseed cultivation in Anhui province declined from 670,000 ha to 551,000 ha, or roughly 1.4 million MTs to 1.27 million MTs.
  • In May 2013, a press article noted that Chinese canola importers were looking to increase imports owing to lower foreign prices vis-à-vis domestically subsidized canola.
  • In April 2013, Canada, the world’s largest canola producer, was granted increased access to crushing plants in China. As a result, Canada could export canola to 11 Chinese crushing facilities (capacity of 5.5 million metric tons).
  • In 2013, China produced approximately 14.4 million MTs of rapeseed. Hubei was the top producer at 2.5 million MTs of roughly 17% of total output. Sichuan was the second largest producer at 2.24 million MTs.
  • China’s canola (rapeseed) production primarily takes places in the center of the country. In 2011, Hubei produced 2.2 million MTs of canola, while Sichuan produced 2.1 million MTs and Hunan produced 1.8 million MTs (total country output was 13.4 million MTs).

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