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Traders: China to Partly Lift Ban on Canola Imports

02 March 2012

CHINA & CANADA - Chinese quarantine authorities will allow imports of Canadian canola by some selected crushers located in major growing areas, partially lifting a ban it imposed because of fungal disease concerns, traders said on Thursday.

The import relaxation, likely to be cleared in the second half of the year, would further boost canola imports from the world’s largest exporter of canola/rapeseed to China later in the year, reports the Toronto Sun.

ICE Canada canola futures rose 11.6 per cent in February, the biggest monthly gain since June 2010, on tight supplies and strong export demand.

On Thursday, canola slipped in early trading with other grains on profit-taking, but ICE Canada traders said eased Chinese restrictions would support the market.

China’s quarantine bureau will allow nine crushers in the country’s major rapeseed-growing provinces of Inner Mongolia, Jiangsu, Shandong and Zhejiang to import Canadian canola, several traders said.

Another nine crushers outside major growing areas in the provinces of Fujian, Guangxi, Liaoning have received authorization to continue to import, they said.

China has restricted imports of Canadian canola since 2009 and only allowed shipments to areas away from the country’s major growing areas on worries over the spread of the fungal disease blackleg.

Canada’s government said canola exports to China totalled $1.8 billion in 2010.

“The restriction will be relaxed but we don’t expect access until the second half of the year when domestic harvest is ready,” said a trading manager with an international trading house.

Chinese quarantine officials declined to comment.

Crushers cannot divert cargoes away from arrival ports, which means crushers in inland regions of Inner Mongolia are still unable to import, he said.

“China has to increase imports given the difficulty of raising domestic production,” said another trader with a state-owned trading house.

Chinese government officials gave no indication to a recent Canadian delegation that they intended to ease restrictions, said Canola Council of Canada vice-president Jim Everson, who travelled to China last month with Prime Minister Stephen Harper.

“Our understanding hasn’t changed, that they’re a valuable partner in this trade, they have concerns about blackleg and we’re taking that seriously here.”

Canada and China are jointly carrying out research into blackleg.

TheCropSite News Desk

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