China lifts ban on Canadian beef and pork exports

Pigs are seen at the Meloporc farm in Saint-Thomas de Joliette, Quebec, Canada, on June 26, 2019. (Photo by Sebastien St-Jean / AFP) (Photo credit should read SEBASTIEN ST-JEAN/AFP via Getty Images)

Canadian beef and pork farmers can finally breathe a sigh of relief, on news China will lift its export ban.

Prime Minister Justin Trudeau made the announcement on Twitter.

“Good news for Canadian farmers today: Canadian pork and beef exports to China will resume. Thanks to Ambassador Barton and the Canadian meat industry for their work on re-opening this important market for our meat producers and their families.”

Dominic Barton, former head of McKinsey and Company and part of Trudeau’s economic council took over the job of ambassador to China, after former ambassador John McCallum was shown the door over his handling of the situation with detained Huawei CFO Meng Wanzhou.

In what was widely viewed as retaliation for the Huawei situation, China put the ban in place in June, citing concerns about contamination.

China is Canada’s third-largest export destination, and the damage from the ban has been severe.

For example, pork prices were already depressed due to Chinese tariffs on U.S. exports, which hurt Canada as it uses the same pricing system, and the ban only made things worse.

“In the third quarter of 2018, this resulted in an unexpected loss of over $120 million for Canadian producers.”

“The situation was made worse by the June 2019 suspension of Canadian pork exports to China, which is costing the industry over $10 million dollars a week,” Gary Stordy, Canadian Pork Council’s director of government and corporate affairs, told Yahoo Finance Canada.

The news is timely considering African swine fever could wipe out a quarter of the world’s pigs, opening the door for Canadian producers to fill the void.

It also puts Canada in a good position to take on its competitors.

“What I think this does is that rather than Canada acting as a backfill supplier to others who have access to China, and benefiting from Chinese demand to the extent that the whole global meat market rises, now Canada can reconnect with Chinese customers directly,” Al Mussell, research lead at Agri-Food Economic Systems, told Yahoo Finance Canada.

“The second point is that Canadian pork will end up having a preference over U.S. product in China due to the duties placed on U.S. pork, at least for Chinese importers that have not been granted duty exemptions.”

The Canadian Meat Council (CMC) thanked Canadian officials for their efforts.

“We would like to express our appreciation to the Government of Canada for all of their efforts both in Ottawa and in Beijing as they worked to find a resolution to this issue,” said Chris White, CMC president, in a release.

“In particular, we greatly appreciated the leadership of the Prime Minister, Ministers Bibeau, Carr, Freeland and Ambassador Barton.”

The Chinese government confirmed its reversal on the ban in a press conference on Wednesday.

Jessy Bains is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jessysbains.

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