China announced on Friday the suspension of certain tariffs on Canadian agricultural products that were imposed during a trade dispute between Beijing and Ottawa. This decision follows an initial agreement reached by Canadian Prime Minister Mark Carney during his visit to China in January.
The tariffs that will be suspended include 100% tariffs on Canadian canola meal and pea imports, as well as 25% tariffs on lobster and crab imports from March 1 until the end of 2026, as stated by the finance ministry.
While the outcome is in line with Carney’s expectations, the Chinese announcement did not address the tariffs on canola seed, which Carney had anticipated would be reduced by March 1. Ottawa had anticipated that Beijing would decrease the canola seed tariffs to around 15% from the current 84%. The investigation into Canadian canola is expected to conclude on March 9, as per the Chinese commerce ministry.
There is optimism regarding the reduced tariff rates as Chinese buyers have already started booking Canadian canola shipments for March. This has boosted confidence in the likelihood of China following through on the tariff reduction, according to Evan Rogers Pay, director at the consultancy Trivium China.
Canola oil and pork were not specifically mentioned in the statement, but adjustments could still be announced by Beijing before the March 1 deadline set by Carney. China was the second-largest market for Canadian canola in 2024.
The tariff suspensions coincide with multiple visits to Beijing by Western leaders, amidst tensions caused by U.S. President Donald Trump’s trade policies that have strained traditional alliances. China aims to position itself as a stable and reliable economic partner amid these challenges.
Mark Carney’s deal with China signals Canada’s ambition to take a leading role in a new global trade order, moving away from dependence on the United States. During his visit, Carney also committed to allowing up to 49,000 Chinese electric vehicles into Canada at a tariff rate of 6.1% on most-favored-nation terms.
