Canada adds 1 mil mt canola export capacity as China tariffs redirect flows

Global trade logistics provider DP World has begun full operations at its C$150 million ($109 million) Canola Oil Transload Facility at Fraser Surrey in British Columbia, adding 1 million mt/year of export capacity and strengthening Canada's ability to move canola oil from prairie farms to international markets at a time when trade headwinds and rising biofuel demand are reshaping the oilseed sector.

Prairie-to-port supply chain

The new facility streamlines the flow of canola oil from the Canadian prairies -- where production is concentrated in Saskatchewan (55%), Alberta (29%) and Manitoba (16%) -- to international buyers. Canola oil arrives by rail, is stored in three 15,000-mt-capacity steel tanks, and is pumped directly to vessels via an underground pipeline, reducing handling and boosting supply chain reliability.

Doug Smith, CEO of DP World in Canada, said in a statement Sept. 18 that the project is designed to keep pace with rising global demand: "By streamlining the movement of oil from rail to vessel, this facility reduces handling, increases throughput, and improves reliability, providing Canadian producers with faster, more efficient access to global markets."

China tariffs force diversification

Canada exported 3.5 million mt of canola oil in 2024, worth C$5.9 billion.

But shipments face growing pressure after China imposed a 75.8% antidumping duty on Canadian canola seed in August, following 100% tariffs on canola oil and meal earlier this year -- effectively shutting Canada out of its second-largest market.

The move has forced Canadian exporters to look for alternative buyers in Europe, the Middle East and Asia, intensifying competition with other oilseed suppliers.

A growing share of that volume is destined for renewable diesel and sustainable aviation fuel production, particularly in the US West Coast market where low-carbon fuel programs have driven strong demand for vegetable oil feedstocks.

Industry participants say the new facility will be key to maintaining Canada's competitiveness in supplying both food and fuel markets, especially as global buyers look for reliable, traceable and low-carbon sources of oil.

Tom Hamilton, EVP of Agribusiness Operations at Richardson International, said: "This investment streamlines the critical connection between prairie production and coastal shipping, allowing us to respond to growing customer demand even further and deliver Canadian canola oil more efficiently to buyers around the world."

The facility was completed on schedule after construction began in late 2023 and includes two rail spur tracks, a marine trestle and loading platform, upgraded berthing safety systems, and environmental protection features such as tank containment walls and a fire water loop.

The project also underscores British Columbia's role as an export hub for Canada's "new economy," said Ravi Kahlon, BC Minister of Jobs and Economic Growth.

"With our ports connecting Canada's heartland to the world, we're supporting farmers and exporters across Western Canada and creating good jobs here in BC while driving sustainable economic growth for the province as we face the threat of tariffs."

At the same time, Canada's renewable fuel sector is scaling up. Imperial Oil recently started up its 20,000-b/d renewable diesel facility at Strathcona, while Ottawa has pledged over C$370 million to incentivize biomass-based diesel production from 2026-27.

Canola oil remains a key feedstock for renewable diesel and SAF production, and industry stakeholders say new export infrastructure will be crucial to balancing food and fuel demand.