Canada’s canola acreage shrinks under threat of double tariffs

Canadian canola could be the crop that will be hit hardest by massive retaliatory tariffs from the United States and China that are set to go into effect soon and are expected to sap global demand for the Canadian product, Bloomberg reports.

“The situation we’re facing right now is quite unique,” ​​says council president Chris Davison. “This is the first time we’ve had a tariff situation in two of our largest markets at the same time.” The two largest importers will import a combined C$12.6 billion (US$8.8 billion) in canola products in 2024, according to the Canola Council of Canada.

The situation is unfolding just ahead of the spring planting season. While many growers have already purchased their seed, they still have time to switch to alternative crops.

Canola futures rose on Tuesday, partly driven by expectations of improving U.S. biofuel demand and speculation that Trump may grant waivers for some products or push back tariffs. On 01/04/2025, the April MATIF price for canola (MATIF) was $568.27/t, up $9.32/t from the previous price of $558.95/t on 31/03/2025, according to OleoScope.

Adding to the cloud over demand, Health and Human Services Secretary-designate Robert F. Kennedy Jr. is promoting animal fat as a healthier alternative to oils made from plant seeds such as canola and soybeans. Demand for animal fats is making a comeback long after the setback seen since World War II. ‘A long-term shift has been initiated. We are on the front lines of people changing the way they eat,” analysts say.

This season, farmers will plant less canola and more wheat. The total of 21.6 million acres (8.738 million hectares) will be the second consecutive annual decline of 1.7%. Overall, acreage has plateaued after peaking at 23 million acres in 2017.

Tags: Canada, rapeseed