China initiates an investigation into alleged cost undercutting practices in Canadian pea starch imports
China has initiated a series of anti-dumping investigations on several Canadian products, including pea starch, canola oil, and halogenated butyl rubber, in response to bilateral trade tensions and perceived discriminatory tariffs by Canada.
The investigations, which began in September, were prompted by complaints from domestic industry insiders. In August 2025, China launched an anti-dumping investigation into Canadian pea starch, citing evidence of significant increases in dumped Canadian pea starch imports, which have allegedly caused losses and difficulties for local producers.
Simultaneously, China imposed temporary duties on Canadian canola oil imports, collecting deposits from companies importing the oil at a steep rate of 75.8 percent. The move came after preliminary findings that Canadian canola was dumped and caused substantial damage to China's domestic industry.
The investigations into pea starch and canola oil follow earlier trade escalations, including Canada’s tariffs on Chinese electric vehicles and China’s tariffs on Canadian rapeseed oil, peas, oil cakes, seafood, and pork.
The anti-dumping probe into halogenated butyl rubber, a material primarily used for pharmaceutical stoppers and the inner lining of tyres, was also initiated in September.
These measures are part of an ongoing tit-for-tat trade conflict, with severe economic consequences for Canadian agricultural exporters. The 75.8% anti-dumping duty on Canadian canola has severely disrupted a previously robust $3.6 billion market, leading to sharp declines in canola futures prices and effectively pricing Canadian canola out of the Chinese market.
For Canadian farmers, who collectively earn roughly $12 billion annually from canola production and export nearly all of their canola to China, this represents a major economic threat and market loss.
China justifies these duties as necessary to protect its domestic industries from "dumping" and unfair competition, while Canada repudiates the dumping allegations and calls for diplomatic solutions.
The pea starch investigation, which may last up to a year with a possible extension, reflects Beijing's broader strategy of using trade measures in response to political and economic disputes with Canada.
Canada was China's second-largest pea exporter in the 2023-24 agricultural season, accounting for 44.6% of China's total pea imports. Russia was China's largest pea exporter in the same period, accounting for 49.1% of China's total pea imports.
The collection of deposits from companies importing these products is in compliance with WTO rules to protect domestic industries. The investigations and deposits are set to take effect on Thursday.
References:
- China launches anti-dumping probe into Canadian pea starch imports
- China imposes anti-dumping duties on Canadian canola oil imports
- China's anti-dumping probe into Canadian canola oil: Implications and background
- Canada calls China's anti-dumping duties on canola oil 'unjustified'
- China's canola oil tariff: What it means for Canada
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