Question Period Note: BILATERAL AGRICULTURAL TRADE WITH CHINA

Q1 – What has been the Government’s response to China launching its anti-dumping investigation on imports of Canadian canola seed? Q2 - What has been the Government’s response to China’s conclusion of its anti-discrimination investigation? Q3 – What is the Government doing to resolve other outstanding non-tariff related trade issues impacting agricultural exports to China? Q4 – What is the Government doing to financially assist the sector?

R.1 - Canada’s agriculture sector depends on a rules-based global trading system that provides reliable market access. Canada is committed to defending the market access interests of the sector.

The Government of Canada appreciates the close collaboration with the Canadian canola sector and provinces following China launching an anti-dumping investigation on imports of canola seed from Canada. While a preliminary duty rate of 75.8% on imports of Canadian canola seed has been imposed, the investigation continues and is now entering its final stage. Canada will continue to participate actively in the case to demonstrate that imports of canola seed from Canada do not compete with China’s rapeseed. We will always stand up for Canadian canola farmers, businesses, exporters, and their communities and support their interests and success at home and in markets abroad.

Canola is one of Canada’s most valuable agricultural exports and an important driver of the economy. We remain committed to ensuring fair market access for our exporters, farmers and producers. R.2 - The Government of Canada recognizes that Canadian industry stakeholders are negatively impacted by the tariffs imposed by China.

The Government of Canada has initiated a dispute settlement process at the World Trade Organization with respect to these unjustified tariffs.

The Government of Canada is working in collaboration with the provinces and industry, to mitigate the impacts of these trade measures, including identifying new market opportunities for Canadian products.

We will continue working with all key players to uphold rules-based trade to maintain predictability for our agriculture producers and exports. R.3 - Canada continues to pursue every available opportunity, both at the bilateral and multilateral level, to press China to resolve current trade issues, respect international trade rules, and base its regulatory decisions on scientific principles.

As such, the Government continues to allocate significant resources, both in Canada and across China, to support Canada’s engagement efforts with China to address trade irritants, promote Canadian products in-market, and advocate for rules-based trade, including science-based regulatory decisions, to advance Canada’s agricultural interests.

Doing business with China is high-risk, and Canadian exporters are facing increasing challenges. The Government continues to encourage Canadian exporters to adopt appropriate risk mitigation and diversification plans. R.4 - The agriculture sector is experiencing multiple challenges, including the tariffs imposed by China, trade uncertainty with the United States, and other risks like animal disease.
In July 2025, federal-provincial-territorial ministers of agriculture reiterated their commitment to enhance the effectiveness of business risk management programs, which included increasing the AgriStability compensation rate from 80% to 90% and doubled the current payment cap to $6 million for the 2025 program year.

On September 5, 2025, the Prime Minister announced a series of new, strategic measures to assist those sectors most impacted by tariffs and trade disruption, including the canola sector. These measures include:

Investment in Agriculture and Agri-Food Canada’s AgriMarketing Program and trade diversification measures: The AgriMarketing Program supports targeted activities to promote Canadian agri-food products as safe, sustainable, and high quality, building Canada’s reputation abroad. The Government is investing an additional $75 million over five years, starting in 2026-27 to expand the program into high-growth areas such as Africa, the Middle East, and the Indo-Pacific. This expansion will support sectors most affected by trade barriers, like canola, and aligns with Canada’s Indo-Pacific Strategy, shifting focus beyond traditional trade partners like the U.S. and China.

Changes to the Advance Payments Program (APP): The Advance Payments Program (APP), delivered by Agriculture and Agri-Food Canada provides Canadian farmers, including canola producers, with low-interest cash advances of up to 50% of the expected market value of eligible products. It helps farmers manage cash flow, avoid high-interest debt, and market strategically. Producers can access up to $1 million per year, with a portion interest-free, typically $100,000, which was increased to $250,000 in March 2025. To respond to ongoing trade uncertainty, especially affecting canola producers, who represent 41% of APP users, the Government is temporarily doubling the interest-free portion for canola advances. For the remainder of the 2025 program year and the 2026 program year, the interest-free limit will rise to $500,000.

New biofuel production incentives, providing more than $370 million over 2 years to assist domestic producers and restructure their value chains: To level the playing field and support Canada’s biofuels sector, the Government intends to make targeted amendments to the Clean Fuel Regulations, introducing a time-limited production incentive for renewable diesel and biodiesel producers and work with provinces and territories to explore complementary measures.

The Government is also providing $1 billion in new financing through Farm Credit Canada (FCC) to reduce financial barriers for the Canadian agriculture and food industry. This lending offer will help address cash-flow challenges so that businesses can adjust to a new operating environment and continue to supply the high-quality agricultural and food products that Canadians rely on. On August 19, 2025, the FCC reiterated its support to the canola sector through this program.

Canada-China Agricultural Bilateral Trade
China is a priority market for Canadian exports of agricultural, agri-food, and fish and seafood products, and despite market access disruptions, China remains Canada’s second largest export market for the sector, behind the United States. Canadian exports of agricultural, agri-food, and fish and seafood products to China were valued at $11.5 billion in 2023 and decreased to $9.6 billion in 2024, representing 9.4% of Canada’s total agriculture, agri-food, and fish/seafood exports to the world. Key exports to China in 2024 were grains and oilseeds (e.g., canola seed, barley, wheat, soya beans), fish and seafood, dried peas, pork products, and animal feed (e.g. canola meal).

Canada’s share of China’s global imports of agriculture, agri-food, and fish and seafood products (by value) has been declining since 2018: 5.8% in 2018 to 3.9% in 2024.

In 2024, canola seed exports to China totaled 5.9 million tonnes, representing about
68 % of total canola exports to all markets. After China, Canada’s largest canola seed export markets in 2024 were Japan, Mexico, the United Arab Emirates, and the U.S. The concentration in canola oil and meal is even greater, with 95.5 % of canola oil heading solely to the U.S., and 99.7% of canola meal heading to the U.S. and China combined in 2024.

Canadian exports of canola meal to China totalled $918 million in 2024, while exports of canola oil represented approximately $21 million. Canada’s pea exports to China amounted to $306 million in 2024. In the same year, Canada exported $1.3 billion and $469 million in fish and seafood products and pork products to China, respectively.

The Canadian government is currently pursuing increased and regular political engagement with China to improve overall bilateral relations and create a favorable dynamic to discuss and resolve bilateral irritants.

Thus far in 2025, Canada and China have had multiple engagements at the official and political levels, including:

• In-person senior official meetings of the Canada-China Economic Partnership Working Group; and the Canada-China Joint Economic and Trade Commission took place last August in Beijing and Ottawa, respectively.
• From September 6 to 9, Premier Moe and Parliamentary Secretary Blois, accompanied by a delegation of Saskatchewan officials, visited China.
• Foreign Affairs Minister Anand’s meeting with her counterpart, Minister Wang Yi in China on October 17.
• From October 27 to November 3, Agriculture Minister MacDonald was in China to engage with senior Chinese government officials, as well as Canadian and Chinese business leaders to promote Canadian agricultural and agri-food products and explore new opportunities for collaboration. In his engagement with Chinese officials, Minister MacDonald also noted the importance of restoring market access for Canadian agricultural products in China.
• On October 31, Prime Minister Carney held a bilateral meeting with President Xi on the margins of the Asia-Pacific Economic Cooperation Economic Leaders’ Meeting in South Korea. This was the first leader-to-leader meeting since 2017. Both Leaders have directed officials to resolve outstanding trade issues and irritants, including agriculture and agri-food products.

Market Access Issues
Canadian agricultural exports continue to be subjected to arbitrary trade actions and non-tariff barriers by China (e.g., unjustified sanitary and phytosanitary measures, lack of transparency), putting market access for Canadian agriculture, agri-food, and fish and seafood exports at risk and adding significant costs and uncertainty for Canadian exporters. China’s current measures against Canada include:

• Beef access: Since December 2021, Canadian beef exports to China remain halted due to China’s BSE-related trade suspension following Canada’s notification of an atypical case of BSE. In accordance with guidelines of the World Organization for Animal Health (WOAH), the detection and reporting of this atypical BSE case did not affect Canada's WOAH negligible risk status for BSE and should not have affected trade. Moreover, revised WOAH standards on atypical BSE adopted in May 2023 reaffirm that atypical BSE detections do not affect the BSE risk status of a country or zone. Despite Canada providing all the technical information requested, China has yet to provide timelines for the restoration of access. Canada continues to engage China to resume trade without further delays.
• Pet food: Since February 2022, Canadian exports of heat-treated dry pet food containing poultry ingredients remain halted due to China’s Highly Pathogenic Avian Influenza (HPAI) trade-related restrictions following confirmation of HPAI in Canada. Canadian officials have stressed that China’s restrictions are not consistent with its World Trade Organization (WTO) obligations, international guidance, and negotiated veterinary certificate, which does not specify that Canada must be recognized as free of HPAI. Canada continues to engage China to remove its restrictions without further delays.

Chinese authorities have shown limited willingness to constructively engage on technical issues with Canadian officials to resolve and advance outstanding agricultural trade issues impacting Canadian exports. In some key trade issues, such as pet food, beef, pulses and oats, Canada’s market access requests and submissions of technical data and/or official letters go unanswered by the General Administration of Customs of the People's Republic of China (China Customs), the CFIA’s Chinese counterpart.

Canadian officials continue to work closely with officials from like-minded countries to share information and experiences and develop common approaches with respect to raising concerns with China’s measures at the WTO. China’s approach to trade continues to shift in contradiction to established international trade rules, its WTO obligations, science-based trade and concerns by trading partners.

China’s actions in response to Canada’s tariffs on Chinese EVs and steel and aluminum

In August 2024, the Government of Canada announced a series of measures to level the playing field for Canadian workers and allow Canada’s EV industry and steel and aluminium producers to compete in domestic, North American, and global markets.
This included the implementation of a 100% surtax on all Chinese-made EVs and a 25% surtax on imports of steel and aluminium products from China that became effective in October 2024.
In September 2024, China’s Ministry of Commerce (MOFCOM) announced a series of measures in response to Canada’s announcement, including:

(i) Initiation of a WTO dispute against Canada;
(ii) China initiated "anti-discrimination investigation" under its domestic law against Canada’s measures and
(iii) Initiation of an anti-dumping investigation into imports of canola seed from Canada.

Anti-discrimination investigation
On March 8, 2025, MOFCOM announced the conclusion of its “anti-discrimination” investigation. Effective March 20, 2025, 100% tariffs are being imposed on imports of Canadian canola oil, canola meal and peas, and a 25% tariff is being imposed on certain fish, seafood and pork products.

On March 20, Canada filed a request for consultations with China at the WTO. Those consultations were held on April 23 and resulted in little progress towards a resolution. Canada’s second request for the establishment of a panel was granted at the June 23 WTO Dispute Settlement Body meeting.

Trade impacts as a result of the imposition of tariffs on Canadian agriculture and agri-food products include:
· Exports of canola oil to China have stopped.
· Exports of canola meal and peas have significantly decreased
· Pork industry indicated a reduction of export volumes by 20 to 30%

Anti-dumping Investigation on Canola Seed
On September 9, 2024, China formally launched a self-initiated anti-dumping investigation into imports of Canadian canola seed. Canada is participating actively in China’s anti-dumping investigation to help defend Canadian interests. This includes engaging with MOFCOM via the Canadian Embassy in Beijing, placing evidence on the record of investigation, responding to questions in the detailed questionnaire issued by MOFCOM, participating in multiple hearings with MOFCOM, and submitting comments on MOFCOM’s Preliminary Determination as well as two expert reports.

On August 12, 2025, MOFCOM announced the findings from their Preliminary Determination that there was dumping of Canadian canola seed, and that China's domestic rapeseed industry suffered “substantial damage” as a result. MOFCOM announced the imposition of a provisional duty rate of 75.8% on imports of seed from Canada, effective August 14, 2025.

On September 5, 2025, MOFCOM announced that it had extended the investigation period by six months. The investigation was set to conclude on September 9, 2025, and has now been extended until March 9, 2026.

• The canola sector is facing an unprecedented number of challenges linked to trade uncertainties with its two largest markets, the U.S. and China.

• Canada’s agriculture sector depends on a rules-based global trading system which supports predictable market access and a level playing field. Canada is committed to defending the market access interests of the sector.

• We are working with industry and provinces to support market diversification efforts and pursue new business opportunities around the world, including through our network of Trade Commissioners and Canada’s Indo-Pacific Agriculture and Food Office.

• While we continue to monitor policy developments, Canada will continue to engage China bilaterally and multilaterally to mitigate unjustified disruptions to trade.
• I recently travelled to China to meet face-to-face with my counterparts, and we agreed to restart the Technical Working Groups, which is a critical step to be able to address regulatory barriers.

• On the heels of Prime Minister Carney’s successful meeting with President Xi, I am committed to keeping the conversation going and looking for ways to support our hardworking farmers and producers.

• The Government will always stand shoulder-to-shoulder with our farmers, producers, and workers who export the finest products around the world.