IN THIS EDITION: A deep dive into Canada’s meat exports allowed back into China; a face-off at the WTO; and a Chinese grocery store chain branching out into Canada.
One Big Story: Canadian meat can once again be exported to China
Canadian meat products, after having been blocked from the Chinese market since June, are now allowed to be exported to China again.
Prime Minister Justin Trudeau announced the news on Twitter, calling it “good news for Canadian farmers.”
Canadian canola and soybeans still cannot be exported to China.
Impact of the ban on the Canadian meat industry
It is certainly good news for Canadian pork and beef producers and processors, which sell a significant amount to China every year. In 2018, $267 million worth of beef products were sold to China, and $511 million worth of pork products were sold to China; that’s 11% and 15%, respectively, of total beef and pork exports.
In September, the Canadian Meat Council said that the cost of the ban to the meat industry was at that point nearing $100 million.
Why was Canadian meat blocked in the first place?
In late June, forged health certificates on a shipment of pork from Canada were discovered (the Canadian government confirmed that the certificates were forged). The Chinese government then asked the Canadian government to suspend issuing export certificates for meat going to China as of June 25.
While the forged certificates were only found with pork, the Chinese government asked the Canadian government to suspend the certificates for all meat exports (almost all meat imports from Canada to China are beef and pork).
What does this mean for Canadian agriculture?
It’s great news for the beef and pork industries – but Canada canola and soybeans are still blocked from being sold to China, as they have been since early in the year. Canola and soybeans are even more dependent on the Chinese market than Canadian beef/pork – in 2018, Canadian canola exports to China were worth $4.4 billion and Canadian soy exports to China were worth $1.7 billion – 40% and 53%, respectively, of total canola and soy exports.
Why is China allowing Canadian meat to be imported again?
The Chinese government said that this is not about improving China-Canada relations, but rather that it was satisfied with Canada’s fixing of “safety loopholes.”
There is speculation that China is allowing Canadian meat imports again because of its struggle with African Swine Fever. China’s hog herds have been decimated by the disease, with hundreds of millions of animals killed. As pork is one of the primary sources of protein eaten in China, the government is scrambling to fill the gap. China has also recently floated the idea of American chicken being allowed in again, has permitted Brazil to export meat offal to China, and has signed a deal with a major European meat processor.
Bottom line:
This is good news for the Canadian beef and pork industries – but is not a sign of improvement in the China-Canada relationship. Canadian canola and soybeans are going to continue to feel the pain from China’s bans.
In other news:
• Canadian canola continues to suffer – this year, it’s been hit by a double-whammy: being blocked out of the Chinese market and a wet, snowy harvest.
• A recent poll shows that less than one-third of Canadians view China favourably – but that 62% support a free trade agreement with China.
• A Chinese grocery store is coming to Canada: Sungiven is making Canada its second market (currently it’s only in China). The chain plans to start in Vancouver and branch out from there.
• One industry has been thriving in Canada, thanks to the China-US trade war: the Atlantic Lobster
• China and Canada met face-to-face at the WTO in Geneva over the block of Canadian canola from the Chinese market.
• Canadian canola is being sold to the United Arab Emirates – which is processing it into oil and selling it to China. Canola exports to UAE have jumped 533% since last year.
• This piece argues that Canada has two “China traps” to break out of – the arrest of Meng Wanzhou and what to do about Huawei and Canada’s 5G network. The author argues that to appease China and America enough that they won’t react adversely, Canada should ban Huawei from its 5G networks and release Meng Wanzhou.
• Yesterday in China was Singles Day – the biggest shopping day of the year. This year, an estimated $38.3 billion in merchandise was sold, the highest amount in sales from a single day ever.
• Finally, this piece talks about what Chinese Ambassador to Canada Cong Peiwu wore to Rideau Hall to meet the Governor General – and what message that clothing sends.
– Sarah Pittman, policy analyst
The China Brief is a compilation of stories and links related to China and its relationship with Canada’s West. The opinions expressed in the links are those of the articles’ authors and don’t necessarily reflect the views of the Canada West Foundation and our affiliates.