Ottawa, ON – Canadian farmers are bracing for a significant economic hit as China slapped crippling tariffs on canola oil, canola meal, peas, and certain pork and seafood products, effective immediately. The move comes after China concluded a domestic “anti-discrimination” investigation launched against Canada on September 26, 2024, a decision deemed “deeply disappointing” by the Canadian government.
The tariffs, hitting 100% on canola oil, canola meal, and peas, and 25% on select pork, fish, and seafood, are expected to severely impact Canadian agricultural producers and businesses. “China’s decision to apply these tariffs will have a devastating impact on our farm families and their communities,” stated the Honourable Kody Blois, Minister of Agriculture and Agri-Food and Rural Economic Development.
China cited the now-concluded anti-discrimination investigation as the basis for the tariffs. However, the Canadian government maintains that its agricultural products meet the highest international standards, its inspection systems are robust, and trade practices adhere to global rules. Officials argue that these tariffs will not only hurt Canadian producers but also drive up prices and reduce choice for Chinese consumers across various sectors, including retail, restaurants, and food preparation industries.
In response to this significant challenge, and acknowledging existing trade uncertainties with the United States and other risks like animal disease, Minister Blois today announced enhanced support for the agriculture sector through the AgriStability program.
AgriStability, a cornerstone of Canada’s agricultural safety net, provides whole-farm protection against large income declines. The government is proposing significant enhancements to the program for the 2025 program year, including:
- Increased Compensation Rate: Raising the compensation rate from 80% to 90%, meaning producers will receive a greater portion of their losses covered.
- Doubled Payment Cap: Temporarily doubling the payment cap to $6 million, a level not adjusted in over two decades, to ensure larger farms receive adequate support.
Furthermore, to expedite financial assistance, the government is offering provinces and territories the option to proactively implement:
- Enhanced Interim Payments: Allowing producers in participating provinces and territories to apply for interim payments of up to 75% of their estimated final AgriStability payment for the 2025 program year.
- Targeted Advance Payments: Enabling administrators to establish Targeted Advance Payments for specific sectors or regions demonstrably affected by market disruptions, such as the current tariffs imposed by China.
Minister Blois emphasized the urgency of the situation and the government’s commitment to standing by Canadian farmers. “We’re working hard to diversify our trading partnerships and establish new markets, but we know the sector needs support now. Today’s announcement is a direct result of their advocacy – and our commitment to them,” he stated.
The impact of these tariffs is particularly concerning given the significant trade volumes with China. In 2024, Canada’s canola meal exports to China were valued at $920.9 million, canola oil at approximately $21 million, pea exports at $303.6 million, and pork exports at $468.6 million. Canola, Canada’s second-largest acreage crop, generated $13.6 billion in farm cash receipts in 2023 alone.
Beyond AgriStability, the government highlighted other avenues of support, including:
- Farm Credit Canada (FCC) Trade Disruption Customer Support program: Offering $1 billion in new lending to help producers navigate financial challenges.
- AgriMarketing Program: Supporting industry efforts to expand exports and explore new market opportunities.
The government reiterated its commitment to working with provincial and territorial partners, industry stakeholders, and remaining open to constructive dialogue with China to resolve trade differences “on the basis of mutual respect and equality.”
“As Canada’s Minister of Agriculture and Agri-Food and Rural Economic Development, I will continue to stand shoulder-to-shoulder with our producers and will defend the sector every step of the way,” Minister Blois pledged.
Producers are encouraged to explore all available business risk management programs, including AgriStability, AgriInvest, AgriInsurance, and the Advance Payments Program, to navigate these challenging times and safeguard their livelihoods. The second intake of applications for AgriMarketing, AgriCompetitiveness, and AgriDiversity programs under the Sustainable Canadian Agricultural Partnership is also currently open.