More canola in Manitoba this year following China deal

The rising price of canola this spring has prompted some Manitoba producers to dedicate more land to the crop this growing season.

Farm Credit Canada data shows that canola prices grew from roughly $625 to $738 per metric tonne between January and May this year, following an announcement of lower Chinese tariffs on Canadian canola.

At the same time, Manitoban farmers are expected to dedicate 4.7 per cent more land to canola this year, said Keystone Agricultural Producers president Jill Verwey. Verwey cited data from Statistics Canada that projected a total of 3.2 million acres of canola in the province for the 2026 season.

The projected growth is explained partially by the trade deal struck with China, as farmers “pulled back” on canola last year during political tension, Verwey said. But farmers’s decision making factors in several other things as well, she said.

In March 2025, China applied retaliatory tarrifs to Canadian canola to protest Canada’s imposition of a 100 per cent tariff on Chinese electric vehicles, steel and aluminum the previous year. The measures — which included a 100 per cent tariff on canola oil/meal and then a 75.8 per cent anti-dumping duty on seeds — led to a roughly nine per cent decrease in Saskatchewan’s benchmark canola price.

These stiff Chinese tariffs were lowered in March following a trade arrangement struck by Prime Minister Mark Carney earlier this year. The prime minister agreed to allow 49,000 Chinese eletric vehicles to be imported into Canada per year at a “most-favoured-nation” tariff rate of 6.1 per cent, rather than the previous 100 per cent tariff that former prime minister Justin Trudeau imposed in 2024.

The deal outlined that China would lower tariffs on Canadian canola seed to 15 per cent, from what was effectively 84 per cent, among other items.

Verwey said that while farmers factor in this updated market, shocks to price are generally less important to farmers than crop rotation, which balances the health of soil over time by growing a variety of crops.

“You can make some short term decisions, but ultimately, you have to look at the what your long term plan is on your farm,” Verwey said. “It’s certainly a balance with what you need for good agronomy on your farm. So you have to look at both sides.”

Long-term profitabilility relies on healthy soil, so it can be costly to invest heavily into canola when the market rises, she said.

“Any short term gain that you might get, well, then you’re faced with, ‘What do you do next year?’”

According to a spokesperson for Export Development Canada, the impacts of lower Chinese tariffs, which took effect in March 2026, have begun to show in weekly trade data.

Export Development Canada deputy economist Ross Prusakowski cited trade statistics from May that marked a record for the last 12 months. In the week ending May 3, Canada exported more than 300,000 tonnes of canola for the first time in a single week since April 2025.

Prusakowski said this reflects the market adjusting to lower Chinese tariffs — but that it is too soon to say it’s the cause. Going forward, however, he predicts that Canada’s exports will continue improving under the new trade agreement.

“We should see some some improvement in price going forward as demand remains strong,” Prusakowski said. “We’ll see more receipts, more income flow to Canadian farmers as we export more canola globally.”

Rivers-area producer Ron Krahn said the improved canola market and rising prices prompted his decision to plant an extra field of canola this year.

“We had one field that we were waffling between two different crops, and we chose canola because prices had been rebounding,” Krahn said. “So that was a positive. It looked more profitable now than peas did.”

Krahn also said that the most important piece for his business decision making is sustainability. Even though canola is rebounding, he said there are specific issues that prevent going all-in.

“You wouldn’t want to just grow your whole farm as canola every year, because that’s not a good rotation from a disease perspective, and insects, and that kind of thing,” Krahn said. “You can’t just always chase whatever looks like it’s going to be the most profitable crop.”

The fewer market influences from the political world, the better, he said.

Canadian canola is attractive and valuable to China, according to Manitoba’s Agriculture Minister Ron Kostyshyn — and the provincial government wants to keep that trading partnership going.

“China definitely needs our canola. And hopefully we’ve come to an understanding, we’ve got a great working relationship,” Kostyshyn said. “We want to continue to network with China and have a market for canola for the farmers.”

Kostyshyn said that in an upcoming meeting with agriculture ministers in Canada, he believes a topic of discussion will be domestic use of agricultural products like canola. The more Canada can process its own product inside its own borders he said, the more secure and insulated the market will be against trade shocks.

The tariffs levied against Canada in 2025 acted as a catalyst for some forward thinking, he said — regarding the United States as well.

“The tariffs kind of woke us up,” he said. “Complacency sometimes needs to have a ‘reset’ button, and that’s exactly where we are.”

Canada’s canola exports to China fell 62 per cent last year and exports to the United States fell nine per cent when faced with tariffs, according to an article from Export Development Canada. At the same time, Canada increased its exports to other countries by 161 per cent.

The pivot was helpful but did not cover the complete loss, as at the end of the 2025 year, Canada’s total canola exports were down 7.4 per cent.

Prusakowski said the 2025 trade pivot strengthened Canada’s export options, and opens Canada to more sustained, diverse demand going forward. China is a leading export destination for Canadian canola.

»cmcdowell@brandonsun.com