China’s decision to impose a 75.8% provisional tariff on Canadian canola seed – effective August 14 – marks the most significant disruption to this export market since 2019, when China denied market access to Canada’s largest canola processors. For farmers and exporters, especially in Saskatchewan, the impact could be immediate and substantial.

Saskatchewan at the Centre of the Storm

Saskatchewan produces more than half of Canada’s canola, with 12.1 million acres planted this year and 9.7 million tonnes harvested in 2024. Canola farming supports 55,000 direct jobs in the province, from growers to processors, and plays a central role in rural economies. Nationally, the canola sector contributes $43.7 billion annually, more than Canada’s steel, aluminum, and car manufacturing industries combined.

Why China Matters

Canada exports about 90% of its canola, and China is our second-largest buyer, accounting for roughly one-third of total exports. In 2024 alone, Canadian seed, oil, and meal exports to China were worth $4.9 billion, with seed making up the bulk of the trade. Saskatchewan farmers have a direct stake in that flow.

What the Tariffs Mean for Farmers

• November canola futures prices fell $30.50 per tonne after the announcement of the new provisional tariff – wiping out about $610 million in value for Western Canadian farmers in just one day.
• If exports to China fall by even 20%, the industry could lose up to $1 billion.
• A full ban on Saskatchewan canola exports to China could cost over 3,800 direct jobs in our province.

We’ve Seen This Before

This is not the first time China has restricted Canadian canola. In 2019, citing “pest concerns,” China suspended major exporters’ licenses. Seed exports fell from $2.8 billion in 2018 to just $800 million the following year, and industry losses over the ban’s first 17 months were estimated at up to $2.35 billion. China launched its current anti-dumping probe in 2024, claiming Canada’s canola sector benefits from unfair subsidies, but the Canadian government and industry reject this, saying the move is tied to broader trade and political disputes.

What the Chamber is Doing

The Saskatchewan Chamber of Commerce has written a letter to Prime Minister Carney on this issue, urging the federal government to:

• Meet with the President of China to push for the removal of the tariffs and full restoration of market access; and
• Ensure Western Canadian agriculture gets the same urgency and federal attention as other industries facing trade disputes.

While the Prime Minister has said that he is considering measures to support farmers impacted by the tariffs, details of a plan have not yet been released.

What’s Next

While Canada may try to redirect canola to markets that Australia currently serves, freight costs to those destinations could be $15–$20 per tonne higher. Meanwhile, China has recently flagged hundreds of Canadian shipments of other commodities, including wheat and barley, for phytosanitary issues – raising concerns that more crops could be targeted if trade tensions escalate.

For now, the message is clear: keep an eye on the markets, talk to your buyers, and be ready for more price swings in the weeks ahead. The Chamber encourages affected businesses to contact us to share how these tariffs are impacting their operations and to stay connected for ongoing updates and advocacy efforts.