This week’s canola market analysis.

• China’s canola imports are projected to drop significantly to 3.1 million tons in the 2025–2026 marketing year, driven by elevated tariffs on Canadian products. Despite these trade barriers, China's domestic production remains stable, with a slight expansion in harvested area anticipated. As a result, total canola consumption is expected to decline to 19 million tons, mirroring a broader pullback in soybean imports as well.
• Canada faces considerable market pressure from reduced Chinese demand. With a strong production forecast of 19.9 million tons for 2025–2026, Canada is pursuing diversification through new markets and domestic biofuel expansion. Policy incentives and increased loan limits for producers aim to support this shift.
• Australia is capitalizing on improved trade relations with China, substantially increasing its canola exports. July exports were robust, especially to Japan, the United Arab Emirates, and now increasingly to China, which is shifting away from Canadian imports. Globally, combined canola and rapeseed production is forecasted to rise to 90.96 million tons, bolstered by favorable harvests in Canada, Australia, Russia, and Moldova.
• Geopolitical and trade developments are also influencing flows elsewhere. The European Union is reevaluating its import strategies following reduced Ukrainian supplies caused by new export tariffs. Meanwhile, Russia's strong rapeseed output and expanded exports to countries like India are altering the global rapeseed oil landscape. The United Arab Emirates and Russia have emerged as key suppliers to India, signaling a redirection in trade patterns.