September 28, 2015 – Negotiations are down to the wire at the Trans-Pacific Partnership (TPP) in Atlanta, Georgia this week. With so much at stake for the canola industry in these talks, the Canola Council will be there to urge Canada’s negotiators to create the stable and open trade required for the industry to grow.
“We need an ambitious TPP deal to grow the value of canola exports in the Asia Pacific region,” says Brian Innes, vice president of government relations for the Canola Council of Canada (CCC). “The status quo means our industry will be struggling against the current just to stay where we are.”
Since Australia implemented their free trade agreement with Japan earlier this year, Australian canola oil faces lower tariffs entering Japan than Canadian canola oil. Currently Canada faces tariffs of 13% on crude oil and 16% on refined oil. These tariffs mean virtually all canola exported to Japan is unprocessed seed. Because of their free trade agreement, tariffs on Australian canola oil into Japan are now 2% less for crude oil and 3% less for refined oil – a difference that will grow over time as tariffs on Australian canola oil are phased out over the next eight years.
“Why should a Canadian grower or canola processor accept being at a disadvantage compared to an Australian grower or processor?” says Innes. “It doesn’t make any sense; we need the TPP to put us on a level playing field.”
Competitiveness in Japan is especially important as it is a high value and stable canola market demanding $1.2 billion worth of Canadian canola annually. Australia is the second largest canola exporter in the world.
“The TPP is simple for canola – if the agreement doesn’t deliver we fall further behind,” says Innes. The Canadian canola industry estimates that being outside the TPP would mean $14 billion in lost export opportunity over the course of the agreement.
An ambitious TPP agreement would be very positive for the canola sector and the communities it supports.
The canola industry estimates an ambitious TPP agreement would increase the overall value of exports by $780 million per year if tariffs on canola oil and canola meal are eliminated. This represents about one million tonnes of canola oil and meal exports combined. Eliminating tariffs on value-added oil and meal would increase the value of Canada’s canola exports and support more domestic processing. Currently the canola industry supports 250,000 jobs and exports $9 billion worth of canola seed, oil and meal annually. More exports will mean more prosperous communities and more jobs.
“An ambitious TPP would support more canola being processed in Canada and more value for the entire industry,” says Innes. “This would support thousands of jobs in communities across the country.”
For more information about the importance of trade to #canolacountry, please visit www.canolacountry.ca.
The CCC is a full value chain organization representing canola growers, processors, life science companies and exporters. Keep it Coming 2025 is the strategic plan to ensure the canola industry’s continued growth, demand, stability and success – achieving 52 bushels per acre to meet global market demand of 26 million metric tonnes by the year 2025. Also included is a plan to double the amount of canola processed in Canada to 14 million tonnes based on stable and open trade.
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Heidi Dancho, Director, Communications