US and China’s trade wars against Canada have brought down prices for canola and rapeseed

After the United States imposed a 25% duty on Canadian goods, China also announced the introduction of a 100% duty on canola oil, meal and peas, as well as a 25% duty on pork and seafood from Canada, starting March 20, 2025, calling it a response to Canada’s introduction of a 100% import duty on Chinese electric vehicles and a 25% duty on steel and aluminum in August 2024.

Canada exports canola oil mainly to the United States and canola meal to China, and last year it supplied about $1 billion worth of canola oil, meal and peas to China.

Against this background, March canola futures yesterday fell 6.8% to 591 CAD/t or $410/t (-12.5% for the month), and May futures – 7% to 603 CAD/t or $418/t.

Following canola prices, May futures for canola on the Paris stock exchange fell 2.9% to 481.75 €/t or $523/t (-10.5% since the beginning of March), as the EU remained the main market for Canadian canola.

Amid the US trade wars against Canada, Mexico and China and promises to impose duties on all imported goods, the US stock market fell by $ 5 trillion, which could lead to a crisis in the US economy.

The oil market reacted by falling, and May futures for Brent crude oil fell by 10.5% to $69.2 per barrel over the month. If the US manufacturing activity does not recover, oil will continue to fall in price.

In Ukraine, the purchase of rapeseed in the Black Sea ports is almost completed, only one trader bought the volumes needed for the ship’s party at the price of 25000 UAH/t or 520 USD/t. But the fall in prices in the EU will soon affect the forward prices for new crop rapeseed.

After China imposed 100% duty on Canadian meal and oil, the most active futures for rapeseed meal on Zhengzhou exchange increased by 6% to 2611 yuan/t or 360 $/t (the largest daily increase since September 2022), and for rapeseed oil – by 5.2% to 9213 yuan/t or 1270 $/t.

However, China can buy rapeseed oil in the EU and Russia, so after the stabilization of the markets can be expected to reduce prices.

Tags: Ukraine, China, EU, prices, Canada, rapeseed, USA