China investigates Canadian rapeseed imports as tariffs on electric vehicles, steel, and aluminum spark tensions
China has initiated an anti-dumping investigation into rapeseed imports from Canada, according to Financial Post.
The investigation comes as trade tensions rise following Canada’s imposition of tariffs on Chinese-made electric vehicles, steel, and aluminum.
This probe comes in response to recent restrictive measures taken by Canada, the Ministry of Commerce in China stated. The ministry emphasized that China would take all necessary actions to protect the legitimate rights and interests of Chinese companies.
Last month, Canada announced a 100 per cent levy on electric vehicles and a 25 per cent tariff on steel and aluminum, aligning with its western allies to support domestic industries.
Rapeseed, commonly used for producing cooking oil and for industrial purposes, is one of the commodities most affected by these rising tensions, with China being the second-largest global importer of the product.
The news had immediate market impacts. On Tuesday, the most actively traded rapeseed meal and rapeseed oil futures on China’s Zhengzhou Commodity Exchange surged by at least six per cent.
In contrast, North American canola futures experienced their largest intraday drop since August 2022, falling by the exchange limit due to concerns that lower Chinese demand could lead to an oversupply in the domestic market.
In 2023, over 90 per cent of China’s rapeseed imports, totalling 5.05 million tonnes, came from Canada, according to Chinese customs data. The type of rapeseed grown in Canada is commonly referred to as canola.
This is not the first time China has targeted Canadian trade; in 2019, it halted canola shipments following the arrest of a senior Huawei Technologies executive in Vancouver.
China’s Ministry of Commerce cited concerns from the domestic industry, alleging that Canada has been dumping rapeseed shipments and that these practices have negatively impacted local markets.
The announcement of the probe also influenced other commodity markets, with palm oil futures in Malaysia rising by 1.1 per cent amid speculation that the investigation could drive increased demand for alternative oilseeds.
