China Hits Canada With Retaliatory Tariffs On Agriculture Goods Amid Intensifying Global Trade War

China has announced retaliatory tariffs on certain Canadian agricultural products in response to Canada’s import duties on Chinese electric vehicles, steel, and aluminum products.

What Happened: China announced on Saturday that it would implement a 100% tariff on Canadian rapeseed oil, oil cakes, and peas. Additionally, a 25% tariff will be applied to aquatic products and pork from Canada. According to a statement from China's Customs Tariff Commission of the State Council, these tariffs are set to take effect on March 20.

The announcement comes amid a swiftly intensifying global trade war, marked by multiple tariff declarations from the U.S., China, Canada, and Mexico in recent months. Canada had previously implemented a 100% import tariff on Chinese-made EVs starting Oct 1. 2024, mirroring similar measures taken by the U.S. and the EU amid concerns about unfair competition. Ottawa also imposed a 25% tariff on imported steel and aluminum products from China, effective October 15.

As a response, in September, China initiated an anti-dumping investigation into Canadian canola or rapeseed imports, which account for over half of Canada’s total canola exports. Notably, in the list released on Saturday, China did not include tariffs on rapeseed imports, but only rapeseed oil and meal.

In an official statement, China’s customs authorities have criticized Canada’s unilateral imposition of tariffs, stating it “disregards objective facts and World Trade Organization rules, is a typical trade protectionist practice, constitutes a discriminatory measure against China, seriously infringes on China's legitimate rights and interests, and undermines China-Canada economic and trade relations.”

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Why It Matters: This development highlights the increasing intensity of the trade wars. It comes in the wake of Mark Carney taking over as Canada’s Prime Minister, tasked with navigating the nation through the challenges posed by tariffs imposed by Donald Trump.

The new tariffs also follow China’s forceful response to President Donald Trump's recent tariff increases, including reciprocal tariffs on selected American goods, sanctions on U.S. companies, and plans to file a complaint with the World Trade Organization. This escalating trade war is likely to have significant implications for global economic and trade relations.

Dan Wang, China director at Eurasia Group in Singapore told Reuters, “By striking now, China reminds Canada of the cost of aligning too closely with American trade policy.”

On Monday, the rapeseed meal futures on the Zhengzhou Exchange surged 6% to 2,611 yuan ($360) per metric ton, marking the largest single-day increase since September 2022.

Meanwhile, rapeseed oil futures rose 5.2% to 9,213 yuan ($1,270) per ton.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.