Canada and China extend trade deal on canola and steel through 2028

Beijing and Ottawa are extending a January agreement to provide Chinese market access to Canadian imports in exchange for Canadian market access for Chinese steel and aluminum. The deal, which was negotiated by Prime Minister Mark Carney and Chinese President Xi Jinping during a visit to China, was originally set to expire at the end of this year.

Extension of trade terms

On Wednesday, Trade Minister Maninder Sidhu stated that the deal is being extended by two years, to the end of 2028. According to a news release from Sidhu, "This extension gives Canadian farmers, producers and harvesters stable access to China and supports billions in export opportunities."

Sidhu noted that the extension follows months of efforts to improve trade relations. In June 2025, Sidhu and China’s minister of commerce, Wang Wentao, agreed to restart a joint economic and trade commission. In January, Sidhu stated that Ottawa secured a preliminary joint arrangement in Beijing that opened up more than $7 billion in market space for Canadian workers and businesses.

Impact on Canadian exports

Since the March arrangement took effect, several Canadian export sectors have seen significant growth compared to the same period last year:

• Canola seed: Increased by 84 per cent, from $1.04 billion to $1.91 billion.
• Canola meal: Exports more than doubled, from $146 million to $390 million.
• Peas: Grew from $107 million to $345 million.
• Lobster: Increased by 57 per cent, from $128 million to $200 million.
• Beef: Canadian beef returned to the Chinese market in January for the first time since 2021. From January to August, Canada sent $363.2 million in beef exports to China, which Sidhu said is nearly double what was sold there in all of 2021.

Saskatchewan’s trade minister, Warren Kaeding, told reporters in Regina that farmers are pleased with the deal, stating, "That helps so much in them being able to plan their cropping rotations into next year."

Fisheries Minister Joanne Thompson said on social media that the extension provides "immediate certainty" for lobster and crab harvesters and exporters.

Diplomatic and geopolitical context

The announcement comes as Chinese Vice Premier He Lifeng is scheduled to visit Vancouver on Sunday and Monday. Sidhu and Finance Minister François-Philippe Champagne are expected to welcome He, with additional events planned with Bank of Canada Governor Tiff Macklem and financial regulators.

Vina Nadjibulla, co-founder of the Centre for Strategic Statecraft, said in an emailed statement that the clearing of "an immediate trade irritant" allows Prime Minister Carney to focus on boosting Chinese investment during his upcoming visit to Shenzhen for the Asia-Pacific Economic Co-operation summit.

Nadjibulla also noted that the deal locks in Chinese steel and aluminum access, which will be a factor in Ottawa’s trade talks with Washington. She wrote, "Ottawa is increasingly having to navigate its economic relationships with Beijing and Washington simultaneously, and decisions made in one relationship inevitably have implications for the other."

China is Canada’s second largest single-country merchandise trading partner, with two-way merchandise trade totaling $125.7 billion in 2025. The Carney government is currently seeking to double non-U.S. exports in the next decade in response to the trading environment following the re-election of U.S. President Donald Trump.

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Sources

• bnnbloomberg.ca: China-Canada trade: Steel, canola deal extended to 2028
• ctvnews.ca: China-Canada trade: Steel, canola deal extended to 2028

This article was drafted with AI assistance and checked against the sources above. Company claims are reported as claims. Cover image is AI-generated.