Beijing this month cancelled Richardson’s registration to ship Canadian canola to China, the world’s top importer of the oilseed, in the latest sign of tensions between the countries, Reuters reported on Tuesday.

Canada and China are locked in a dispute over trade and telecoms technology that has ensnared the chief financial officer of Huawei Technologies, the world’s largest telecommunications equipment maker, who faces U.S. criminal charges.

China foreign ministry spokesman Lu Kang said on Wednesday that customs officials had frequently discovered pests in samples taken recently from imports from Canada, which supplies more than 90 per cent of Chinese canola imports.

Winnipeg-based, privately-held Richardson is the largest exporter of Canadian canola to China and its shipments met Chinese requirements, said Jean-Marc Ruest, the company’s general counsel and senior vice-president of corporate affairs.

“We’re firmly of the view that there was no substantiation of those allegations,” he said in a phone interview.

Richardson is working with the Canadian government to end China’s block on its canola shipments but does not know how long the suspension will last, Ruest said.

Asked about the reason for the suspension, he said: “We can only guess at this point in time. We’re a prominent Canadian corporation.”

Beijing has previously warned of potential curbs on canola imports, citing concerns over fungus in the imports. Canola is used for cooking and as feed for animals and fish.

In 2016, China tried to impose tougher standards on levels of foreign material in canola imports, which was seen by some as an effort by China to reduce high domestic stocks.

“Recently China customs frequently detected hazardous pests in imports of Canadian canola, and in one company’s imports the problem was particularly serious,” Lu said during a regular press briefing.

Lu did not identify the company but said the situation led customs to temporarily suspend imports.

The latest suspension was completely “reasonable and legal” and aimed at protecting the health and safety of Chinese citizens, Lu said.

Canada’s agriculture minister said Tuesday that Canada’s food inspection agency had carried out further investigations in response to China’s moves and had not identified any pests or bacteria of concern.

ICE May canola futures fell for a second straight day, down $2.30 or 0.5 per cent, to $455.50 in midday trading.

— Reporting for Reuters by Ben Blanchard in Beijing and Tom Polansek in Chicago; writing by Dominique Patton.

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Trump laid out a list of more than 800 strategically important imports from China that would be subject to a 25 per cent tariff starting on July 6, including cars, the latest hardline stance on trade by a U.S. president who has already been wrangling with allies.

China’s Commerce Ministry said it would respond with tariffs “of the same scale and strength.” The official Xinhua news agency said China would impose 25 per cent tariffs on 659 U.S. products, ranging from soybeans and autos to seafood.

China’s retaliation list was increased more than six-fold from a version released in April, but the value was kept at $50 billion, as some high-value items such as commercial aircraft were deleted (all figures US$).

Shares of Boeing, the single largest U.S. exporter to China, closed down 1.3 per cent after paring earlier losses. Caterpillar, another big exporter to China, ended two per cent lower.

Trump said in a statement that the U.S. would pursue additional tariffs if China retaliates.

Washington and Beijing appeared increasingly headed toward open trade conflict after several rounds of negotiations failed to resolve U.S. complaints over Chinese industrial policies, lack of market access in China and a $375 billion U.S. trade deficit.

“These tariffs are essential to preventing further unfair transfers of American technology and intellectual property to China, which will protect American jobs,” Trump said.

Analysts, however, did not expect the U.S. tariffs to inflict a major wound to China’s economy and said the trade dispute likely would continue to fester.

TVs spared, chips added

U.S. Customs and Border Protection will begin collecting tariffs on 818 product categories valued at $34 billion on July 6, the U.S. Trade Representative’s office said.

The list was slimmed down from a version unveiled in April, dropping Chinese flat-panel television sets, medical breathing devices and oxygen generators and air conditioning parts.

The tariffs will still target autos, including those imported by General Motors and Volvo, owned by China’s Geely Automobile Holdings, and electric cars.

And USTR added tariffs on another 284 product lines, valued at $16 billion, targeting semiconductors, a broad range of electronics and plastics that it said benefited from China’s industrial subsidy programs, including the “Made in China 2025” plan, aimed at making China more competitive in key technologies such as robotics and semiconductors.

Tariffs on these products will go into effect after a public comment period. A senior Trump administration official told reporters that companies will be able to apply for exclusions for Chinese imports they cannot source elsewhere.

Most semiconductor devices imported from China use chips produced in the United States, with low-level assembly and testing work done in China, prompting the Semiconductor Industry Association to call the new tariff list “counterproductive.”

The USTR official said the tariffs were aimed at changing China’s behavior on its technology transfer policies and massive subsidies to develop high-tech industries. The United States now dominates those industries, but Chinese government support could make it difficult for U.S. companies to compete.

Washington has completed a second list of possible tariffs on another $100 billion in Chinese goods, in the expectation that China will respond to the initial U.S. tariff list in kind, sources told Reuters.

U.S. soybean futures plunged 1.5 per cent to a one-year low on concerns that an escalating trade fight with China will threaten shipments to the biggest buyer of the oilseed, traders said.

Beijing and Washington had held three rounds of high-level talks since early May but failed to reach a compromise. Trump was unmoved by a Chinese offer to buy an additional $70 billion worth of U.S. farm and energy products and other goods, according to people familiar with the matter.

Analysts at Capital Economics said the impact of the tariffs on China’s economy would be small. Even if the U.S. duties reach the full $150 billion, they estimated it would shave well under a half-percentage point off China’s annual growth rate, which could be offset by fiscal and monetary policy actions.

“Neither side will be brought to its knees – which is one reason to think the trade dispute could drag on,” Capital Economics said. “For China’s part, its leaders will be determined not to be seen to back down to foreign pressure.”

Although shares of some tariff-sensitive companies fell on Wall Street, the stock market overall fell only modestly.

“With the announcement of the tariffs, there’s a real risk that we can see a continued increased escalation,” said Robin Anderson, senior economist at Principal Global Investors in Des Moines, Iowa. But he said that underlying strong economic fundamentals in the U.S. would dampen the market impact.

Trump has also triggered a trade fight with Canada, Mexico and the European Union over steel and aluminum and has threatened to impose duties on European cars.

Renewed worries about the escalating trade conflict sent shares in Chinese telecoms gear maker ZTE tumbling ahead of Trump’s announcement on Friday.

ZTE last week agreed to pay a $1 billion fine to the U.S. government to end a supplier ban imposed after it broke an agreement to discipline executives who conspired to evade U.S. sanctions on Iran and North Korea.

While China in recent months made incremental market-opening reforms in industries that critics in the foreign business community say were already planned, it has not been inclined to yield on its core industrial policies.

“U.S.-China trade tensions will be long-lasting,” Yifan Hu, regional chief investment officer and chief China economist at UBS Wealth Management, told a briefing in Beijing.

“The trade skirmish is not just about the trade deficit and exchange rates, but about the rules of the game, market openness and intellectual property. It is also about values, governance and geopolitical disagreements,” she said.

— Reporting for Reuters by David Lawder in Washington and Ben Blachard in Beijing; additional reporting by Stella Qiu in Beijing.

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Just a day before the new standards were due to go into force, Canadian Prime Minister Justin Trudeau and Chinese Premier Li Keqiang said Canada would be able to continue with the current canola export regime, while a longer-term solution was worked out.

China is Canada’s top export market for the oilseed, and Ottawa has taken an increasingly strong line in talks on a new standard, which industry participants say would significantly raise costs for exporters.

While only temporary, the exemption for Canada will be seen as a small victory for Trudeau. The import dispute has taken centre stage during his visit to China.

China has said the tougher import rules were necessary to prevent the spread of blackleg disease from Canadian canola into Chinese rapeseed crops.

“China itself is a large producer of canola, but China has no intention of keeping its doors closed to other exporters,” Li told a joint news conference with Trudeau at his side.

“But it’s also true that Chinese canola producers have their own worries, hoping that imported canola will not carry with it any disease. Chinese consumers also have that issue on their mind,” Li added.

Both sides should take a flexible attitude on the canola issue, he said.

Industry participants say the new standard, under which China will reduce the amount of foreign matter allowed per shipment to no more than one per cent from 2.5 per cent, would significantly raise costs for exporters.

China in 2009 blocked imports of Canadian canola citing concerns over transmission of blackleg to Chinese rapeseed. Canola shipments later resumed to designated ports, while Canada and China agreed to run joint research on the disease and its transmission.

Negotiating teams from the two countries were currently meeting in Beijing, Canada’s Trade Minister Chrystia Freeland said.

“We are now working on achieving a long-term agreement on terms of Canadian canola shipments and, as the prime minister said, we are working to achieve that in the coming days and weeks,” she told reporters.

China imported 3.8 million tonnes of Canadian canola last year, valued at $2 billion, making the crop Canada’s single most valuable export to China, according to the Canola Council of Canada.

China has also been keen to start talks on a free trade agreement with Canada, similar to the pacts Beijing has sealed with Australia and New Zealand, although a senior Canadian government official said last week there is no near-term chance of agreement.

Li said both countries had agreed to start feasibility talks on a free trade pact at an early date, although Trudeau made no mention of this in remarks in front of reporters.

— Reporting for Reuters by Ben Blanchard and Beijing Monitoring Desk. Includes files from AGCanada.com Network staff.

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The fire broke out just after dawn near Dehui in Jilin province. The provincial government said it sent more than 500 firefighters and more than 270 doctors and nurses to the scene, evacuating 3,000 nearby residents as a precaution.

China Central Television showed thick black smoke pouring from a low-slung, one-storey building with an arched roof over part of it.

Flames shot through some rooftop vents, and firefighters on the ground and on high ladders poured water onto the roof and onto smouldering debris inside the building.

CCTV showed a backhoe punching through a wall so firefighters could aim more water inside.

“It was so fast — we first saw a flash, then there was a big ‘bang’,” an unidentified employee of the slaughterhouse told CCTV. “We knew it was bad, so then we all ran. We didn’t know what happened, we didn’t know it was an explosion.”

The death toll prompted President Xi Jinping, on a visit to Latin America and the U.S., to issue instructions to care for the injured and vigorously investigate the cause of the disaster, holding accountable according to law all found to be responsible, the television reported.

Premier Li Keqiang called on firefighters and other emergency workers to proceed urgently to save lives as the top priority, CCTV said.

Local police said ammonia gas leaks might have caused the explosions, prompting the evacuation of residents, the China News Service reported.

More than 300 workers were in the plant at the time, with employees reporting hearing the bang and then seeing smoke, state news agency Xinhua said.

“About 100 workers have managed to escape from the plant whose gate was locked when the fire occurred,” Xinhua said.

“The complicated interior structure of the prefabricated house in which the fire broke out and the narrow exits have added difficulties to the rescue work.”

The exact number of people missing was unclear, as was the cause of the fire, Xinhua said. The Jilin government said 60 people were injured and had been rushed to hospital.

People took to social media sites to express their anger.

“Was this place never regularly inspected by fire safety authorities?” wrote one user on China’s popular Twitter-like service Sina Weibo.

“Senior officials need to be sacked because of this,” wrote another.

Relatives demand explanation

Victims’ relatives gathered outside the building to “demand the government investigate and announce the cause of the accident as soon as possible”, Xinhua said.

Hong Kong’s Phoenix Television cited family members as saying that the doors were always kept locked during working hours, during which workers were forbidden to leave, and that the slaughterhouse never carried out fire drills.

China’s record is poor. Fire exits in factories are often locked or blocked and regulations can be easily skirted by bribing corrupt officials.

Jilin is a largely agricultural province and an important grower of corn and soybeans.

The slaughterhouse is owned by a small local feed and poultry producer called Jilin Baoyuanfeng Poultry Company, according to the government.

A fire at a nightclub in Shenzhen, just across the border from Hong Kong, killed 44 people in 2008. A senior policeman was jailed for taking bribes to allow the unlicensed venue to remain open.

One of modern China’s worst fire disasters occurred in late 2000, when fire engulfed building workers at a discotheque in a mall in the central city of Luoyang, killing 309.

Many of China’s deadly industrial accidents happen in the huge coal mining industry, in which more than 1,300 people died last year from explosions, mine cave-ins and floods.

— Ben Blanchard is a Reuters correspondent based in Beijing. Additional reporting for Reuters by Terril Yue Jones in Beijing.

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The H7N9 bird flu strain does not appear to be transmitted from human to human but authorities in Hong Kong raised a preliminary alert and said they were taking precautions at the airport.

In Japan, airports have put up posters at entry points warning all passengers from China to seek medical attention if they suspect they have bird flu.

A total of 14 people in China have been confirmed to have contracted H7N9, all in the east of the country. One of the cases was a four-year-old child, who was recovering, the official Xinhua news agency said.

Two people died April 4, both in Shanghai, bringing the number of deaths to five, state media said. Four of the five have died in Shanghai, China’s booming financial hub.

Authorities in Shanghai also discovered the H7N9 virus in a pigeon sample taken from a traditional wholesale market, Xinhua added, believed to be the first time the virus has been discovered in an animal in China since the outbreak began.

“(China) will strengthen its leadership in combating the virus… and co-ordinate and deploy the entire nation’s health system to combat the virus,” the Health Ministry said in a statement late on Wednesday on its website (www.moh.gov.cn).

In Hong Kong, authorities activated the preliminary “Alert Response Level” under a preparedness plan for an influenza pandemic, which calls for close monitoring of chicken farms, vaccination, culling drills, and a suspension of imports of live birds from the mainland.

All passengers on flights in and out of Hong Kong were being asked to notify flight attendants or airport staff if they were feeling unwell.

Vietnam said it had banned poultry imports from China, citing the risk from H7N9.

In Beijing, the Health Ministry said the government would swiftly communicate details of the new strain to the outside world and its own people, following complaints it had been too slow to report on the outbreak and suspicion of a cover-up.

Chinese Internet users and some newspapers have questioned why it took so long for the government to announce the new cases, especially as two of the victims fell ill in February. The government has said it needed time to correctly identify the virus.

In 2003, authorities initially tried to cover up an epidemic of Severe Acute Respiratory Syndrome (SARS), which emerged in China and killed about 10 per cent of the 8,000 people it infected worldwide.

Transparent communication

China “will continue to openly and transparently maintain communication and information channels with the World Health Organization and relevant countries and regions, and strengthen monitoring and preventive measures,” the ministry said in a statement.

Flu experts across the world are studying samples isolated from the patients to assess the human pandemic potential of the strain.

Other strains of bird flu, such as H5N1, have been circulating for many years and can be transmitted from bird to bird, and bird to human, but not generally from human to human.

So far, this lack of human-to-human transmission also appears to be a feature of the H7N9 strain.

“The gene sequences confirm that this is an avian virus, and that it is a low-pathogenic form (meaning it is likely to cause mild disease in birds),” said Wendy Barclay, a flu virologist at Britain’s Imperial College London.

“But what the sequences also reveal is that there are some mammalian adapting mutations in some of the genes.”

This, she said, meant the H7N9 virus had already acquired some of the genetic changes it would need to mutate into a form that could be transmitted from person to person.

While Xinhua said it was unfair to compare SARS with H7N9, as the new bird flu virus had yet to show signs of human-to-human transmission, it did warn that the government’s credibility was on the line.

“If there is anything that SARS has taught China and its government, it’s that one cannot be too careful or too honest when it comes to deadly pandemics. The last 10 years have taught the government a lot, but it is far from enough,” it said in a commentary.

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