China raps Ottawa as dispute over Canada canola exports deepens

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OTTAWA - A dispute over Canadian canola exports to China intensified on Thursday when Beijing criticized Ottawa's insistence that bilateral relations could not improve until the matter is settled.

The situation is threatening to mar Canadian Prime Minister Justin Trudeau's official visit to China next week to deepen ties between the two nations.

"We oppose linking a concrete issue of bilateral trade with China-Canada relations," the Chinese embassy in Ottawa said in an emailed statement.

Canada, the world's biggest exporter of canola, wants China to drop plans to toughen inspection standards on Sept 1. At stake is C$2 billion ($1.6 billion) in annual Canadian exports of the crop, which is used mainly to produce vegetable oil.

China says the tougher inspection standards are needed to fight the blackleg crop disease.

"The quarantine of canola is merely a technical issue that should be solved properly through consultations by relevant competent departments," said the embassy.

The embassy issued its statement after Canadian Trade Minister Chrystia Freeland said in an interview on Wednesday that "we cannot take the next step in our relationship with China" until the issue had been resolved.

Although Freeland called Chinese Commerce Minister Gao Hucheng late on Wednesday to convey Canada's serious concerns, her intervention did not produce an immediate breakthrough.

Freeland's spokesman, Alex Lawrence, said the two ministers had what he called a lengthy and productive conversation.

"They agreed to continue working closely and to remain personally focused on a solution," he said.

After Trudeau's Liberals took power last November, the prime minister instructed Freeland to expand trade with China to help boost a struggling export sector that is still largely dependent on the United States.

China has raised concerns for years that blackleg could spread from Canadian canola into Chinese crops of rapeseed, another name for the oilseed.

Traders suggest China's real reason for a higher standard is that its domestic rapeseed oil stocks are high.