BEIJING, SASKATOON — Canada and China reached an agreement to lower tensions and move past recent trade disputes as they forge a renewed economic partnership, following a meeting Friday, Jan. 16, between Prime Minister Mark Carney and Chinese President Xi Jinping.
Under the new agreement, Canada will lower tariffs on some Chinese-made electric vehicles, while China will do the same for Canadian products such as canola oil, meal, peas, lobster and crab. The deal is set to take effect March 1.
Late last year, Canada imposed 100 per cent tariffs on all electric vehicles and some hybrid cars from China, a move the federal government said was meant to protect the country’s auto industry from low-cost Chinese imports.
China retaliated with duties on key Canadian agricultural products, including 100 per cent tariffs on canola oil, meal and peas, and 25 per cent tariffs on pork, lobster and shrimp. It also added a 75.8 per cent anti-dumping duty on Canadian canola seed in August 2025.
Now, China will reduce its canola seed tariffs to about 15 per cent, while canola meal will not be subject to duties from March 1 until the end of the year. The agreement brought significant relief to Saskatchewan’s canola producers, as China represents a $4-billion market for Canada’s canola industry.
Premier Scott Moe, who was part of the Canadian delegation, and Opposition Leader Carla Beck issued separate statements praising the outcome of the trade talks, noting the reopening of access to China’s market of 1.4 billion people for products such as Saskatchewan canola and potash.
“Today’s trade deal to significantly reduce Chinese tariffs on canola and other Canadian products is excellent news for Canada and Saskatchewan. This deal is a very positive signal that will restore existing trade volumes and open avenues for further opportunities for Canadians,” said Moe.
“Today demonstrates the importance of foreign trade missions and shows what can be achieved when the federal and provincial governments and our export industries work together to strengthen our trade relationships. Saskatchewan will continue these efforts in our export markets around the world.”
Beck said she was pleased to see progress toward restoring access to China’s massive market, noting that tariffs imposed last year on canola — one of Saskatchewan’s most significant exports — by one of Canada’s largest trading partners caused widespread concern among producers.
“I want to thank our producers and industry leaders who have not given up the fight for fair market access and will continue to advocate for a complete reversal of all tariffs – the only solution to tariffs is no tariffs. Our world-class producers deserve to get back to doing what they do best – feeding the world,” said Beck.
A fortune teller?
The outcome aligns with what Dr. Stuart Smyth, a professor in the University of Saskatchewan’s Department of Agricultural and Resource Economics, said he expected, given China’s need for high-quality canola oil — something Canada produces in abundance.
Smyth was the final speaker in a series of talks held at the NuFarm Information Theatre during the three-day Western Canadian Crop Production Show at Prairieland Park.
“China would never admit that they’re struggling to get a good, reliable source of canola oil, especially one that has stability at high frying temperatures, that’s the value and Canadian control,” said Smyth on Jan. 15.
“Australia produces the same canola, but because of blackleg [a fungal disease], China has not imported canola from Australia since 2019. Since they [Australia] don’t have black leg-resistant [canola] varieties, it will cost them a massive production decline.”
Smyth said China has been forced to source canola elsewhere, and that while it has not been publicly stated, Chinese consumers want their leaders to resolve the tariff dispute so Canadian canola can again meet domestic demand.
Smyth is also closely watching the political situation in the United States, where there is still a lot of uncertainty when it comes to tariffs talks, which could influence future trade relations.
He said the outcome could shift ahead of November’s elections, noting the GOP currently holds a five-seat majority in the House and a 53–45 advantage in the Senate. Several key Republican lawmakers have announced they will not seek re-election, potentially giving Democrats an opening.
“Some of those swing states, there’s a chance that they could go Democrat right now. The margin in the Senate is very close. At [the House], there’s a little bit more of a gap there. But anytime an election comes up, it is a bit of a crapshoot,” said Smyth.
“We have no idea what’s going to happen between January and November before those ballots are marked, and something could come out of left field that alienates voters or swings them back the other way and says, you know what we love, what’s going on, and Congress is firmly in [GOP] control again.”
He added that another possible scenario is Democrats gaining control of both chambers, leaving the Trump White House with a lame-duck government during the final two years of the president’s second term.
