Jakarta | Reuters — Feed millers in Vietnam are taking advantage of bargain prices with rare purchases of Canadian canola meal after China, its traditional buyer, curbed imports by imposing hefty anti-dumping d uties earlier this year, three traders said on Tuesday.
Vietnamese millers have been importing around 30,000 metric tons a month of Canadian canola meal, used mainly in animal feed, for the past few months, two Singapore-based traders and one Ho Chi Minh-based trader told Reuters on the sidelines of an international industry conference in Jakarta.
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The purchases show how trade frictions are disrupting global flows of goods. Vietnam typically imports soymeal, not canola meal, for animal feed, but the drop in price since China imposed duties on Canadian shipments has made canola meal far more attractive.
More deals expected
Vietnamese feed makers were paying $220 per metric ton (C$302.30), including cost and freight, for Canadian canola, compared to around $300-$310 per ton paid by Chinese buyers before the duties were imposed in March, according to traders.
“The volumes are not huge as compared with what China was buying, but shipments are heading to Vietnam,” said one of the Singapore traders. “We expect more deals in the coming months.”
The traders declined to be named as they were not authorized to speak to the media.
Canadian officials had constructive talks with their Chinese counterparts about Beijing’s duties during a recent visit, Prime Minister Mark Carney’s office said in a statement on Friday.
Canadian canola meal stuck in China
China, the world’s largest importer of canola, imposed preliminary duties of 75.8 per cent on Canadian canola seed imports in August.
Earlier, Beijing had imposed a 100 per cent retaliatory tariff on imports of canola meal and oil from Canada, effective March 20.
Some Canadian canola meal cargoes, which arrived in China after the 100 per cent duty took effect and are now stuck in bonded warehouses, could be redirected to Vietnam, traders said.
Up to 400,000 metric tons of canola meal are sitting in secure warehouses near Chinese ports, with importers facing a 100 per cent duty if they release the cargoes for sale in the domestic market.
“Trading companies which have Canadian canola lying in China are trying to sell to feed companies in Vietnam,” said the second Singapore trader. “But the demand is not very big.”
