Canada-China trade deal brings relief to farmers

A new Canada-China trade deal announced Friday is offering a measure of relief and renewed uncertainty for canola growers across Westman.

The announcement is a positive step after months of trade uncertainty, said Simon Ellis, who owns Black Creek Farm near Brandon.

“I think it’s a really good step forward,” Ellis said Saturday. “It seems like our government is working hard to get some deals made, get our crops moving and help support the price.”

Under the preliminary agreement, Beijing is expected to cut canola seed duties to 15 per cent from 84 per cent by March 1, a move Prime Minister Mark Carney has described as “enormous progress.”

Canadian canola meal, along with lobsters, crabs and peas, will also be exempt from Chinese “anti-discrimination” tariffs from March through at least the end of the year. Canola oil, however, remains subject to a 100 per cent tariff. In return, 49,000 Chinese electric vehicles will be permitted into Canada annually at a 6.1 per cent tariff, down from 100 per cent.

Ellis said canola prices did react immediately to the news, but only modestly, adding prices rose by about 30 cents per bushel early in the day (Friday) before easing back by market close.

“We didn’t actually see very much on our end,” he said. “And I don’t think anything is supposed to take effect until March.”

Despite the limited short-term movement, Ellis said growers are hoping the deal will provide price support heading into the spring, when many are finalizing cropping plans amid high input costs and tight margins.

“Looking at our budgets right now, it doesn’t look very optimistic,” he said. “The prices aren’t very good, and the cost to grow a crop is very, very high. Hopefully, this will raise the price of canola and get farmers back into more profitable situations.”

Those pressures have already led some Westman producers to consider scaling back canola acres in favour of other crops. Ellis said a sustained price improvement could slow or reverse that trend.

“If the price actually does come up, I think people will be more inclined to grow a bit more canola,” he said. “Diversification will still be part of risk management on most farms.”

The tariff reduction is significant not only for pricing, but for market access, an issue that has weighed heavily on farmers since duties were imposed, Manitoba Canola Growers executive director Delaney Burtnack told the Sun in an email.

“Aside from price, the big risk is farmers being unable to sell their canola when they need to because the exporter doesn’t have access to a market,” Burtnack said. “Ideally, this announcement will restore trade to our No. 2 global market and keep farmers free to sell their canola.”

Burtnack said much of the 2025 crop remains in storage, and with high costs continuing into 2026, growers need both strong prices and timely sales to prepare confidently for the coming season. While many farmers pre-booked seed last fall and may have limited flexibility to change rotations this spring, she said a finalized deal would provide reassurance that canola remains a viable crop.

“Farmers have enough stress in their business without politically driven trade barriers affecting their production needs,” she said. “The industry is still unpacking the implications of leaving canola oil out of the agreement.”

“Canola oil is a smaller but important product in the Chinese market, and we’re hoping the final decision brings us closer to free trade for seed, meal and oil,” Burtnack said.

The deal carries broad economic significance for Manitoba, including Westman, where canola plays a central role in farm incomes, PC agriculture critic Konrad Narth said.

“Canola makes up about 25 per cent of Manitoba’s farm cash receipts,” Narth said. “Roughly $2.4 billion of that is exported, and when you look at direct and indirect impacts, it supports about 35,000 jobs in the province.”

Narth said producers across Manitoba have watched closely, given China’s importance as a buyer and ongoing uncertainty in other trade relationships.

“This is going to give producers encouragement heading into the seeding season,” he said. “Even before the deal takes effect, we’re likely to see markets strengthen, which helps farmers who’ve been holding grain in the bin because prices weren’t viable.”

While growers welcome the breakthrough, Ellis said there are still unresolved trade barriers affecting other crops, including pulses, and he hopes the federal government continues to push for broader market access.

“We need to get our products out to market,” he said. “If they can continue removing those barriers, it should really help farm-gate prices heading into spring.”

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