China to launch anti-dumping investigation into Canadian rapeseed

Photo: Michael Bell The Canadian Press This investigation by China is particularly targeting canola, a plant related to rapeseed and developed in Canada. It is mainly used as an edible oil.

Matthew Walsh – Agence France-Presse in Beijing

Published yesterday at 8:46 a.m.

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China announced Tuesday that it would launch an anti-dumping investigation into Canadian canola, an apparent retaliatory measure for Ottawa’s massive tariffs on imported Chinese electric vehicles.

Prime Minister Justin Trudeau announced in late August a 100% tariff on Chinese electric vehicle imports starting in October, citing alleged “unfair competition.”

“China does not play by the same rules as other countries,” he said to justify this decision intended to “defend Canadian jobs and interests.”

The Canadian surtaxes target automobiles produced in China, trucks, buses, as well as electric delivery vans and certain hybrid models.

The only electric vehicles manufactured in China and imported into Canada are, for the moment, those of the American brand Tesla.

3.47 billion This is the total value, in dollars, of Canadian canola exports to China in 2023.

Beijing has repeatedly threatened the country with retaliation. On Tuesday, China’s Ministry of Commerce said it would “initiate an anti-dumping investigation into imported canola from Canada,” without specifying a timeline.

In fact, the investigation is specifically targeting canola, a plant related to rapeseed that was developed in Canada. It is mainly used as a cooking oil.

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“Unfair competition”

Canada is one of the world’s leading producers of canola, an oilseed used to make cooking oil, animal feed and biodiesel, and China has historically been one of its main customers.

According to Beijing, Canadian rapeseed exports to China “increased significantly,” to $3.47 billion (€3.14 billion) in 2023, with prices that “continued to fall.” Canadian exporters are thus “suspected of dumping” on the Chinese market, the ministry estimates.

Dumping consists of selling a product abroad at prices lower than those practiced on the domestic market and therefore distorting competition.

“Hit by unfair Canadian competition, Chinese industries linked to rapeseed continue to suffer losses,” stressed the ministry, which is considering referring the matter to the World Trade Organization (WTO). China “will take all necessary measures to defend the legitimate rights and interests” of its companies, he stressed.

Ottawa and Beijing have been at loggerheads for several years, particularly since the Huawei crisis and the arrest in 2018 of Meng Wanzhou, the Chinese group’s CFO, followed by the imprisonment in China of two Canadian citizens.

Surcharges

In recent years, Chinese car brands have accelerated their conquest of the foreign market, with many Western countries now worried about seeing their markets flooded with vehicles at knockdown prices.

The European Union (EU) believes that their prices are artificially low due to subsidies from the Chinese state, which distorts competition and harms the competitiveness of European manufacturers.

Brussels thus raised its surcharges in July to against electric vehicles imported from China. From October, they could reach up to 36%.

Vehicles manufactured in Chinese factories were previously taxed at a rate of 10% in the EU.

In August, China brought the matter before the World Trade Organization and in recent weeks launched several anti-dumping investigations targeting certain European products (dairy and pork products, spirits).

Determined to slow Chinese progress in the automobile sector, the United States announced in May the quadrupling of customs duties (from 25% to 100%) on imported Chinese electric vehicles.