Canadian canola meal sales to China spike to five-year high
By Rod Nickel and Hallie Gu
WINNIPEG/BEIJING (Reuters) - Canadian canola meal shipments to China have jumped to their highest level in five years, boosting profits of crush plants and firming prices as farmers slog through a difficult harvest.
Canada shipped 415,000 tonnes of canola meal to China from January through August, the most since 2011 and following zero shipments last year, according to Canadian Oilseed Processors Association (COPA). The shipments are worth C$132.1 million.
Several Canadian plants were registered this year for trade by Chinese authorities, a process that took more than a year for some, said Chris Vervaet, executive director of COPA, whose members include Bunge Ltd (BG.N: Quote) and Cargill Ltd [CARGIL.UL].
Canola, known for its vivid yellow flowers, is crushed mainly to produce vegetable oil, vying against oils made from palm and soybeans. Its protein-rich meal feeds animals including U.S. dairy cattle.
Stronger canola meal demand from China comes as Canadian crushers steadily expand capacity. Cargill opened last year a new Alberta plant, and Richardson International is expanding a facility in the province.
"Finding alternative markets to the U.S. is huge for our continued growth, Vervaet said.
Strong meal demand lifts crusher profits, increasing the prices they are willing to pay farmers, many of whom have struggled to complete harvesting in snowy, autumn weather.
Canadian canola crush margins last week were more than double those of a year ago, ICE Futures Canada said. Continued...