March 9, 2012

Tongwei to buy more Canadian rapeseed until 2015

Tongwei Co. Ltd., a firm that produces livestock feed, said last week it would raise its purchases of Canadian rapeseed meal for use in China's growing dairy and aquaculture sectors.

The Chinese company said it would boost purchases of Canadian rapeseed meal to US$300 million annually by 2015 in response to increasing demand from fish farms. The ramp up of imports from Canada is also in response to China's halt on imports of meal from India after some shipments were found to contain a dye used to brand grain sacks.

The deal was announced during a trade trip to China by Prime Minister Stephen Harper, several members of his cabinet, farm trade associations and other business leaders.

Gerry Ritz, the federal agriculture minister, said the deal with Tongwei was the result of research funded by the Canadian government that helped demonstrate the superior quality of Canadian rapeseed for use in Chinese aquaculture and dairy rations.

Ritz was accompanied by representatives from Grain Growers of Canada, the Canola Council of Canada and Pulse Canada. Representatives from Canada's beef and pork industries were also along as part of the agriculture delegation. After meeting with representatives of Tongwei Co. in Chengdu, China, the delegation later toured a rapeseed crushing plant that crushes upwards of 600,000 tonnes of rapeseed annually. The agriculture delegation was to join the Prime Minister's group in Beijing for further trade development work.

In a statement released last week the Grain Growers of Canada said the Chinese feed company could be in the market for upwards of one million tonnes of rapeseed meal within five years.

Jim Everson, the vice-president of corporate affairs for the Canola Council of Canada, said the deal with Tongwei Co. will be good for Canadian producers as it provides another market. Everson was in China travelling with the agriculture delegation and issued comments by way of a statement from the rapeseed council.

"When Chinese dairy and aquaculture producers become more aware of the benefits of canola meal, the Canadian canola industry benefits through strong prices and increased market options."

Last week Canada and China agreed to collaborate on rapeseed research that will provide additional science on a rapeseed disease called blackleg.

The Canola Council of Canada is hoping to have the research advanced enough for review by Chinese officials later in 2012.