Canola sector develops new trade strategy

Source: www.producer.com

Canada’s canola is sailing into stormier seas, but ones across which golden shores can still be glimpsed.

Getting across the rough waters to the promising shores is something the canola industry’s new Market Access Plan is aimed at achieving.

It’s less of an aggressive reaching-toward opportunities and more of a preserving the opportunities that have long been recognized, but suddenly seem less obtainable.

“The world of trading our products is becoming more complex,” said Brian Innes, Canola Council of Canada’s vice-president for public affairs.

“Countries are putting in more regulations around food and feed safety, around environmental safety on things like weed seeds and plant diseases, and they’re putting in more regulations themselves as opposed to relying on international standards like Codex (Alimentarius.)”

The new Market Access Plan replaces the 2013 plan, which was written in a time of increasing market access and world trade liberalization.

After the past five years, including the protectionist presidency of former U.S. President Donald Trump and trade battles in many parts of the world, the former confidence of ever-increasing trade access seems outdated.

Especially for Canada, China’s violent disruption of canola trade over a non-canola-related diplomatic dispute two years ago shattered the confidence that reliance upon international rules, norms and trade treaties would be adequate protection for the bulk of trade to operate unhindered.

That’s one reason Innes thinks that farmers shouldn’t ignore the growing risks to canola export access, even though prices today are at record highs.

“This is a major risk to them,” said Innes.

“What we saw with the China situation is how quickly things happen and how much of an impact they have.”

The Market Access Plan calls for more intensive monitoring, assessment of and interaction with various actions overseas on regulatory, environmental and other issues that are taking greater roles in determining the acceptability of foreign crops in various markets.

Today it is seeing growing threats from:

  • Protectionist policies.
  • Different approval standards and systems for innovative technology in various markets.
  • Increasing “sustainability” standards overall, and specific biofuel standards in particular.
  • Regulations and standards not being set by international agreements or codes, but following individual nations’ specific focuses, many not based on science.

“Governments are putting in regulations based on consumer pressure,” said Innes.

“That’s the sort of protectionism that’s having the biggest impact on the market access issues that we’re facing.”

Indeed, that general risk seeping into many overseas markets from customized acceptance standards is more disruptive than either the Chinese or Trump trade snarls so far, Innes said.

The Market Access Plan sees industry doing some of the monitoring, assessment and interaction with foreign regulators and officials, but also urges the federal government to grapple with looming threats to Canadian exports.

Innes said much of the work will need to be done by government officials because these are government-to-government situations.

However, the challenge to the federal government is not just with foreign markets. The government also needs to get serious about updating and revamping some of Canada’s own regulatory and approval processes to allow Canada’s industry to thrive.

Now, outdated and inadequate approval systems for various innovative technological developments are holding back Canada’s industry, slowing the adoption of new technologies like gene editing, and discouraging investment in Canada’s agricultural-biological economy.

“Right now, we’re mediocre, and that’s not good enough for any sector that’s so export-dependent,” said Innes.

“We export 90 percent of what we produce, and to excel and grow and add value back to Canadians we need to up our game.”

Canada shouldn’t be lagging other advanced nations, Innes said. Canada’s only real advantage is being technologically advanced. It doesn’t have the low costs for bulk production of some countries and doesn’t have the political power of others.

“We are a mid-sized economy with a highly developed agricultural economy that depends on technology and adopts innovation,” said Innes.

“We’re like the U.S., but without the same power.”

With all the threats and hostility to the free flow of trade developing around the world, Canada needs to at least ensure that its domestic structure encourages Canadian agriculture to be as innovative, productive and advanced as possible, Innes said. Canada can’t afford to have domestic handicaps weaken Canadian exporters before they get their products outside the borders.

“We are not hitting the ball out of the park,” said Innes.

“We are scrambling. And we need to be strategic as a country because we are not the most powerful.”

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