Canola Industry Hopes Trade Deal Will Bring $1 Billion Annually
The pending Trans-Pacific Partnership (TPP) trade deal will have varying effects upon many agricultural industries within the 11 member countries but for the Canadian canola industry it could mean the ability to grow the industry by approximately $1 billion per year.
The level global playing field that the trade agreement would create is key to the industry, Patti Miller, president of the Canola Council of Canada (CCC) says, adding that the recent free trade agreement forged between Australia and Japan giving preferential status to Australian canola, makes the TPP even more important to Canadian producers. Canada has been shipping canola seed to Japan for approximately 40 years at a value of about $1 billion per year, but is currently prohibited from shipping canola oil, which is subject to a 15% tariff.
Starting on May 14, a two-week long session of negotiations regarding settlement of the TPP is beginning. Upon the finalization of the agreement, Canadian canola producers believe that there will be the possibility to increase exports of canola oil by 1 million tons throughout the member countries, at a value of $780 million.
Canada is the world’s largest canola producing country and it exports 90% of the canola it grows and processes.
“Stable and fair trading rules and equal access are critical to us as far as our ability to achieve our strategic plans and continue to have a profitable industry,” says Patti Miller.
Others worry about the industry’s ability to compete. “After 20 years we have gotten used to taking off early Thursday afternoon because we have made our money in the U.S. market,” says Carlo Dade, the director of the Center for Trade & Investment Policy at the Canada West Foundation. Adding that under the TPP, other countries will be a vying for a share of that market.