Canadian foreign minister decries China halting canola shipments

Sipa via AP Images

Sipa via AP Images

Chinese customs administration's list of approved grain importers says Richardson is no longer permitted to ship the oil seed to China, according to a document obtained by The Globe and Mail. A note beside the entry for Richardson International in the latest document reads: "Canola export registration already canceled".

A Canadian grain industry source with knowledge of the matter confirmed Richardson's exports of canola to China had been halted. Officials at China's General Administration of Customs didn't respond to requests for comment.

Although China has raised concerns about bacteria and pests in Canadian canola exports in the past, Ruest said he does not believe there is actually any quality issue. "The timing suggests it's something much greater than a quality issue that pertains to Richardson", he said.

Canada and China are locked in a dispute over trade and telecoms technology that has ensnared the chief financial officer of Huawei Technologies Ltd, the world's largest telecommunications equipment maker, who faces US criminal charges.

Canada and China are now at odds over the arrest of Chinese telecom executive Meng Wanzhou on behalf of the United States.

China detained former Canadian diplomat Michael Kovrig and businessman Michael Spavor in what observers see as retaliation just days after Canada arrested Meng.

"We reviewed those allegations along with the Canadian government and came to the conclusion that they were unfounded", said Ruest.

China's move to halt canola imports from Winnipeg-based Richardson, first reported by Reuters, comes amid rising tensions between Beijing and Ottawa following Canada's arrest of Huawei chief financial officer Meng Wanzhou in Vancouver on Dec.1, on a USA extradition request.

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"The situation with the Richardson company concerns me greatly", said Foreign Minister Chrystia Freeland, the daughter of a canola farmer.

"We think that there are no scientific reasons for this action".

She added: "I'd like to remind Canadians or any Chinese people who are listening that the trade in canola between Canada and China is mutually beneficial". She described it as "an utmost priority of our government".

Canada exported more than US$3.75 billion worth of canola a year ago, with nearly half of it, or about five million tonnes, going to China, according to industry figures.

China, the world's largest importer of canola, has been known to use the power of its market to retaliate against other nations, said Neil Townsend, a senior analyst at FarmLink Marketing Solutions.

The small black canola seeds are processed to make cooking oil, animal feed and biodiesel.

Though other Canadian companies also received the initial notifications in December, Ruest said he didn't know if any other companies have also had their authorization removed.

It s one of the largest single canola exporters in Canada, and "news about blocked exports hurts the whole value chain", Canola Council communications director Heidi Dancho said.

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