Canola and crude oil futures in China surged after the imposition of a 100% tariff on Canadian oil.

Following the decision to impose a 100% tariff on canola oil from Canada, the number of canola and crude oil contracts in China increased sharply.

Illustrations of the Chinese and Canadian flags - Photo: REUTERS

According to Reuters, on March 10, the number of rapeseed oil contracts in Zhengzhou surged after China decided to impose a 100% tariff on imports of rapeseed oil products from Canada.

In China, rapeseed oil prices are trading very positively, rising 5.2% to 9,213 yuan ($1,270) per ton.

In particular, on the Zhengzhou exchange, oil prices rose 6% to 2,611 yuan ($360) a ton – the biggest increase since September 2022.

Previously, on March 8th, China announced its latest retaliatory trade measures against Canada. According to the Chinese Ministry of Finance , the new tariffs, effective from March 20th, include a 100% import tax on rapeseed oil, dried oil, and peas, along with a 25% tax on seafood and pork products.

Beijing's actions are in response to Canada's tariff policy, which imposed a 100% tariff on electric vehicles manufactured in China and a 25% tariff on steel and aluminum imported from the country.

Anilkumar Bagani, research director at Mumbai-based Sunvin Group, said: "China has alternative sources of rapeseed oil to Russia and Europe, and China's increased import tariffs are also putting pressure on Canadian rapeseed oil prices, leading to a sharp drop in prices from that country."

Mr. Bagani added: "It should also be noted that China currently has very large reserves of rapeseed oil and a fairly high production and crushing capacity."

According to Reuters, citing traders and analysts, the move from China "could create new negotiating opportunities in the two countries' trade talks."

Canada's second-largest trading partner.

According to AFP, Canada is one of the world's leading producers of canola – a crop used to produce cooking oil, animal feed, and biofuels. China used to be one of Canada's biggest customers in this industry.

However, relations between the two countries have become seriously strained since 2018, when Canada arrested Meng Wanzhou, a senior executive at Chinese technology giant Huawei. In response, Beijing arrested two Canadian citizens.

To date, China is Canada's second-largest trading partner, but it lags far behind the United States.

Source: https://tuoitre.vn/hop-dong-dau-hat-cai-va-dau-tho-tai-trung-quoc-tang-vot-after-applying-100-tax-to-canada-20250310145632858.htm