China has increased purchases of Australian canola after imposing steep duties on Canadian imports, raising concerns about the impact on Canadian producers and the broader trade relationship.

State trading firm COFCO secured up to nine cargoes of Australian canola, each about 60,000 metric tons, set to ship between November and January. The orders follow China’s decision in August to impose preliminary anti-dumping duties of 75.8 per cent on Canadian canola, effectively closing off one of Canada’s largest agricultural markets.

Canada supplied the bulk of China’s 6.4 million tons of canola imports in 2024, valued at about US$3.4 billion. With new tariffs in place, Canadian shipments have sharply declined, leaving Australia to fill part of the shortfall. Recent trial agreements allowed Australian exporters to resume sales after a four-year halt caused by biosecurity restrictions.

For Canadian farmers, the restrictions create uncertainty in pricing and market access at a time when harvests are strong. Without China, producers are forced to rely more heavily on alternative buyers such as Japan, Mexico and the European Union. These markets, however, cannot absorb the same volume, placing pressure on farm incomes and storage capacity.

The dispute highlights the vulnerability of Canada’s agricultural sector to geopolitical and trade tensions. While Canada remains a much larger and more consistent supplier than Australia, the loss of access to its biggest customer could encourage China to diversify supply chains further, reducing reliance on Canadian oilseeds in the long term.

Globally, the shift is likely to increase competition for available canola, with higher shipping costs and logistical challenges playing into price fluctuations. Australia benefits in the short term by regaining market share, but analysts caution that it lacks the scale to fully replace Canadian exports.

China has extended its investigation into Canadian canola imports until March 2026, leaving the future of trade between the two countries unresolved. Until then, uncertainty is expected to weigh on Canadian farmers and the wider agri-food economy.