The Canola Council of Canada will have twice as much money to promote Canadian canola oil and meal exports this year thanks to $1.16 million from the federal government’s AgriMarketing program.
“It enhances our ability to work in our existing markets, but it also frees up dollars to allow us to investigate and look at other markets that we should be moving canola oil into,” Cory McArthur, the canola council’s vice-president of market development told reporters here after the funding was announced by Prince Albert MP Randy Hoback during the council’s 44th annual meeting July 27.
Most of the money will be spent promoting Canadian canola oil and meal in Canada’s major canola export markets, including the United States, Mexico and China, as well as India, where the council hopes to boost sales.
Last year India purchased just 3,000 tonnes of Canadian canola oil and no seed, but it’s a huge potential market for several reasons, McArthur said. One is its big population; the other is increasing health issues.
“They consume about 11 per cent of the world’s vegetable oil so it’s a huge opportunity for us,” he said.
“I believe India is the diabetes capital of the globe with 35 million diagnosed with Type-2 diabetes.”
Canola is considered one of the healthiest vegetable oils because it has the lowest fat content at around seven per cent, contains no trans fat (if the oil hasn’t been hydrogenated), has no cholesterol and is the best source of omega-3 fat among cooking oils.
Reaching Indian and Chinese consumers about the benefits of canola oil is a challenge, McArthur said. People in both countries confuse it with rapeseed and mustard oil because the plants look similar, but the oil profiles are much different.
In developed markets, the council partners with the national heart and diabetes associations to promote the benefits of canola oil, he said.
The council pushes canola oil to India rather than seed because making oil boosts Canada’s economy. There are also tariff and non-tariff trade barriers against canola seed imports, McArthur said.
India currently buys canola oil from Australia, United Arab Emirates, Ukraine and Canada.
In 2010, Canada exported $1.8 billion worth of canola seed, oil and meal to China, making it Canada’s biggest canola customer, despite restrictions on seed imports, which began in 2009 after China raised concerns Canadian canola could spread the fungal disease blackleg to Chinese rapeseed fields.
Initially China wanted to ban all Canadian canola imports unless declared blackleg free, but compromised allowing shipments to continue to five plants away from China’s rapeseed-growing area.
Last week the federal government announced those five Chinese crushing plants will continue to import Canadian canola until a long-term solution is reached.
The U.S. was Canada’s second-biggest canola customer in 2010, purchasing $1.5 billion of seed, oil and meal, followed by Japan, which imported $1 billion worth of seed.
Last year Canadian farmers produced 11.8 million tonnes of canola worth $6 billion at the farm gate, according to the council’s 2010 annual report. Of that production 7.09 million tonnes of seed, 1.73 million tonnes of oil and 1.78 million tonnes of meal were exported. (Canada consumed 490,000 tonnes of oil and 760,000 tonnes of meal worth $610 million.)
Even though canola is doing well, Hoback said it makes sense for Ottawa to invest in canola promotion to encourage increased demand and production.
“All these efforts will put more money into producers’, processors’ and exporters’ pockets,” he said.
“This is a great Canadian success story and we as a government are proud to invest in it.”
The council’s goal is for Canadian farmers to produce 15 million tonnes of canola by 2015 matched by an increase in demand, McArthur said.
That goal was in reach this year had it not been for a wet spring, which delayed or even prevented seeding in many areas, he said. Estimates put Western Canada’s unseeded acres at six million to eight million, of which an estimated 2.5 million were intended for canola, he said.
The bigger question is how many tonnes of canola will be harvested this fall, McArthur said. [email protected]