Canola futures were hammered lower on Tuesday as the policies of US President Donald Trump sparked the start of a continental trade war.
Threatened by the White House since January, the 25% tariff on US imports of most Canadian goods, including canola products, officially took effect at midnight, prompting immediate retaliation from Canada. Trump also announced tariffs on Mexico and ramped up existing tariffs on imported goods from China.
The US is the largest buyer of Canadian canola oil and canola meal, with total export value in 2023 of $8.6 billion and $7.7 billion in 2024.
Canola is the single largest contributor to farm crop cash receipts – grown by nearly 40,000 farmers across the country.
“The uncertainty created by this situation continues to impact farmers as they inch closer to planting the 2025 crop,” Rick White, Canadian Canola Growers Association (CCGA) President and CEO, said in a release today. “The damaging blow caused by tariffs will be felt by every canola farmer, starting with the price they receive at delivery and will extend to the full range of their operations, ultimately reducing farm profitability.”
Canola was also pressured by heavy losses in the Chicago soy complex, with China announcing retaliatory measures against the US as well, including on soybeans. China is the world’s largest soybean buyer and the No. 1 customer for American soy growers. Losses in palm oil and European rapeseed added to the downside.
May canola tumbled $24.10 to $607.30, and November lost $17.70 to $621.20.
