On September 9 of 2025, federal Agriculture Minister Heath MacDonald participated in a conference in Winnipeg to discuss challenges and solutions for Canada’s producers of canola, suggesting the possibility of reducing tariffs on Chinese-made electric vehicles (EVs) to support Canada’s canola industry.
Before the implementation of the tariffs in 2023, the market share of EVs in the automobile industry was 13%. Of the 252,000 fully electric or plug-in hybrid electric cars sold in Canada, 25,000 were manufactured domestically. Many cars came from China, which exported 1.15 million EVs in total globally, 45,000 of which were to Vancouver. For context, Chinese EVs like the BYD Seagull cost $13,800; compared to the cheapest EVs made in Canada costing around $45,000, Chinese EVs are much more affordable. The dominance of Chinese EVs only continues to grow, with the EV industry increasing in market share to 17% by 2024.
Chinese-made EVs are less costly than Canadian-made ones due to the well-developed battery industry in China. The top 6 battery manufacturing giants in China accounted for 67.5% of the global EV battery market in 2025. Of these battery makers, one is BYD, who also makes EVs. Chinese EV manufacturers produce EVs at a cost that is 30-50% cheaper than their counterparts in many western countries, equipping them with a competitive edge in the global market.
In October 2024, Canada, in suit with the US, imposed a 100% tariff on Chinese EVs to protect domestic automakers, protecting them from Chinese competition. After the tariff, competitive Canadian EV options included the 2022 Kia Niro EV, costing $45,000 to $55,000. Sales of fully electric vehicles decreased by 39.2%, while new registrations for hybrid electric vehicles like the 2022 Kia Niro Hybrid EV, costing $27,000 to $37,000 increased by 60.7%.
In response, China imposed a tariff of their own on Canadian canola-related products of 100%. Canada exports about 90% of its canola, with China as its second-largest buyer. Canada’s canola industry represents 200,000 jobs and $43 billion for the economy, of which $3.6 billion is in export revenue from China in 2024. With the tariff, exports have decreased, severely impacting the Canadian canola industry. Canola futures prices fell $30.50 per tonne after the tariff. In two weeks, farmers reported losing at least $140 million on their canola, amounting to $800 million from March 2025 to present day. To support the domestic canola industry and its farmers after losing access to one of the world’s biggest markets, a $370-million production incentive was implemented.
This is not the first time China has used reciprocal measures against Canada. In 2019, a suspension in Canadian canola export licences decreased seed exports from $2.8 billion in 2018 to just $800 million the following year, and industry losses over the ban’s first 17 months were estimated at up to $2.35 billion.
MacDonald hopes that with negotiations with China and lowering Canadian tariffs on Chinese-made EVs, these reciprocal tariffs placed on Canadian canola products will be lifted as well, supporting a crucial Canadian industry.
