China has escalated its trade dispute with Canada by slapping 75.8 per cent tariffs on Canadian canola, one of Alberta's major crops, on Aug. 12.
The tariff increase appears to have caught Canadian canola industry reps and government officials by surprise, according to media reports.
According to a Reuters report, the official reason for the escalation is a result of China's China’s Ministry of Commerce anti-dumping probe found that "Canada’s agricultural sector - particularly the canola industry - had benefited from 'substantial' government subsidies and preferential policies."
The new tariffs are still considered temporary until China makes a formal decision on the matter. The tariff may also be an attempt to pressure Canada to get trade concessions in other areas. Canola has often been a target of Chinese punitive actions in the past when it has been displeased with Canada for other reasons.
Alberta is an important producer of canola, accounting for over 35 per cent of Canada's total crop, according to the Government of Alberta.
The U.S. has also been trying to have Canada adopt the same tariff levels it has imposed against China, (as high as 125 per cent on most goods if no agreement can be reached between the two trade super powers), as part of its conditions to come to a trade agreement between to the two North American neighbours.
The Canola Council of Canada told The Canadian Press (CP) earlier this year that "anti-dumping investigations are initiated when a country suspects a product is being imported at a lower price than it is sold for in the domestic country in which it is produced."
"The CCC believes strongly that Canada’s canola trade with China is aligned with international rules-based trade," says a statement on the organization's website, posted before China's announcement.
According to CP, China's commerce ministry also said in a separate social media post Tuesday that the two countries met four days ago to discuss trade.
"The two sides had in-depth and frank exchanges on bilateral economic and trade relations and key economic and trade concerns of both sides, and exchanged views on deepening bilateral, regional, and multilateral economic and trade co-operation," the post read.
Canada imposed a 100 per cent tariff on Chinese electric vehicles in October 2024, a move that is to be reviewed within one year.
Canada supplies China with most of its canola but China currently exports very few electric vehicles to Canada.
-With files from the Canadian Press
