Canola futures start the trading week at a two-year low after Canadian exporters confirmed that China has halted all purchases, claiming shipments from Canada are contaminated.
Canadian canola oilseed for May delivery closed down 3.1% at $453.90 a metric ton in New York on Friday, the biggest loss for a most-active contract since July 2016 and the lowest price since August 2016.
The Canola Council of Canada said Friday that China had stopped all purchases of the Canadian product. That confirmation follows a March 1 statement by Richardson International that China had suspended its licenses after claiming that its canola shipments had pests and bacteria in them.
Canadian government officials in Ottawa say they haven’t found any evidence of pests, and Richardson, the country’s top canola exporter, signaled the decision to restrict its shipments is likely linked to an escalating diplomatic row with China over the detention of a Huawei Technologies Co. executive in Vancouver.
Canola seeds are crushed for oil used in everything from salad dressing to deep frying. Canola is also used as livestock feed. Data released Friday by Statistics Canada showed that February crushing was down 6% from the same month last year.
