China Responds to Canada’s EV Tariff with Canola Anti-Dumping Probe

Beijing has announced plans to launch an anti-dumping investigation into canola imports from Canada, among other measures, just days after Ottawa imposed tariffs on Chinese-made electric vehicles (EVs).

China’s Ministry of Commerce in a Sept. 3 release accused Canada of canola dumping and announced an anti-dumping probe into Canadian canola imports and certain chemical products.

China is a major consumer of Canadian canola products, accounting for nearly one-third of Canada’s $15.8 billion total canola exports in 2023, according to the Canola Council of Canada. This includes imported canola seeds worth $3.8 billion, canola oil valued at $208 million, and canola meal worth $923 million.

Beijing’s announcement follows Ottawa’s decision to impose a 100 percent tariff on all Chinese-made EVs, including some hybrid models, as well as a 25 percent tariff on Chinese steel and aluminum products. The Canadian government said that these measures, set to take effect in October, aim to protect Canadian industries and workers from “unfair” Chinese trade practices, such as extensive state subsidies and strategic domination of the EV market.

Canada’s measures align with those of the United States and the European Union, which have also recently imposed tariffs on Chinese EVs. U.S. President Joe Biden increased tariffs on Chinese EVs from 25 percent to 100 percent, effective Aug. 1, while the EU announced a tariff of up to 37.6 percent on Chinese-made EVs, starting in July.

The Chinese commerce ministry has threatened to appeal Canada’s tariffs to the World Trade Organization’s dispute settlement mechanism.

The Epoch Times contacted Global Affairs Canada and International Trade Minister Mary Ng for comment, but didn’t immediately hear back.

Retaliatory Measures

This is not the first time China has taken action against Canadian canola in apparent retaliation.

China previously imposed a three-year ban on Canadian canola following the diplomatic rift over Canada’s arrest of Meng Wanzhou, a senior executive of Chinese telecom giant Huawei. The ban began in March 2019, months after Canada arrested Meng in Vancouver in response to a U.S. extradition request on charges of bank fraud.

The canola ban was lifted in March 2022, several months after Meng Wanzhou reached a deferred prosecution agreement with the U.S. and returned to China in September 2021.

Before the trade tensions, the Chinese market accounted for 40 percent of Canada’s canola exports, according to the Canola Council of Canada. The industry organization reported that seed exports to China dropped by over 70 percent, from $2.8 billion in 2018 to $800 million in 2019.

The dispute cost the industry between $1.54 billion and $2.35 billion from lost sales and lower prices between March 2019 and August 2020 alone, the council said.

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