Canada’s imposition of tariffs on imports of electric vehicles was met with retaliation by China.
First were tariffs on processed canola, then more recently on canola seed.
Canada has relied on the Chinese market for canola products and seed exports, selling two-thirds of exports to the Asian country.
The Chinese canola seed restriction wipes out that market for Canada’s 40,000 canola growers.
Farm organizations have been vocal in demanding federal funds to compensate them for loss of this market due to international politics.
Saskatchewan Premier Scott Moe called for assistance, pointing out that the agriculture industry is larger than the auto or lumber industry.
Does that mean canola farmers will get plenty of compensation from Ottawa?
Canadian farmers already have an array of income protection programs to use when times get tough.
For starters, farmers have crop insurance and pay only 40 per cent of the insurance premiums.
When commodity prices fall, insurance amounts decline too, leaving less cash for claims.
The Agri-Stability program compensates individual farmers when their margins decline over 30 per cent. After the first Chinese tariffs, the feds increased the claims payout to 90 per cent of losses and doubled the maximum payout to $6 million.
The Agri-Invest program allows farmers to contribute a portion of sales to a fund with no taxes on the contributions and some government-matched interest.
The Agri-Recover program compensates farmers for losses from disasters. Long-term market trends are among the items covered by this federal-provincial program.
These don’t mention the wide range of program grants to farmers for everything from marketing grain to environmental plans, or the $1 million cash advance program with interest-free free on the first $250,000.
Farmers compare their plight to auto workers.
This sector in Canada receives this kind of safety net when the market goes wrong or weather harms production compared with many others.
Expectations of assistance to canola growers should be rewarded, but not with great expectations.
On another vein, federal Conservative leader Pierre Poilevre wants Canada to use tariff funds collected from importing Chinese electric vehicles to compensate canola growers.
Good, slick idea, but how many EVs will Canadians import from China with a 100 per cent tariff?
In 2023, Canada imported 44,356 Tesla EVs from China. It is doubtful that anyone will pay twice as much for a Tesla from China.
Ron Walter can be reached at [email protected]
The views and opinions expressed in this article are those of the author, and do not necessarily reflect the position of this publication.
