Anger over Huawei CFO's arrest sparks B.C. agri-food exporter concerns

Mainland China is sector’s second-largest export market

Bremner Foods Ltd. owner Terry Bremner exports juices, such as 100% pure cranberry juice to China | BIV files

With anger rising in China over the December 1 arrest in Canada of telecom executive Meng Wanzhou for potential extradition to the U.S., B.C. agri-food exporters are watching the situation closely.

Mainland China is, after all, B.C.’s second-largest market for agri-foods and seafoods – a category that includes pork products, seafood such as geoducks, crab, shrimp, hake and sole and a wide range of fruits and juices.

Were a Canadian food products boycott to gain momentum, many B.C. agri-food businesses could be hurt.

The U.S. government alleges that Huawei Technologies Co. Ltd. CFO Wanzhou misled financial institutions into providing money for corporate dealings that contravene U.S. sanctions against Iran.

Anger that she would be detained in Canada without charges and at the request of the U.S. government has thus far not been directed at farmers.

But some retail boycott initiatives, such as those against winter-wear maker Canada Goose Holdings Inc. (NYSE:GOOS), have started to take shape.

The B.C. government estimates that the export value of B.C. agri-foods to mainland China in 2017 was $395.2 million. That’s a 10.1% share of all of the province’s agri-food exports.

Mainland China’s slice is small compared with the U.S., the destination for 71.7% of B.C. agri-food exports, but it is still significant.

“Canada is kind of caught in the middle here, between China and the U.S.,” said Bremner Foods Ltd. owner Terry Bremner, who makes and sells blueberry, cranberry and other juices from fruit grown in Delta.

“I’m not sure how it is going to affect us. I think, at the end of the day, there are so many different news issues. Ultimately people still want to eat healthy, and the farmer hasn’t done anything wrong and we’re still producing good clean food.”

While Bremner hopes that the anger over Wanzhou’s treatment will blow over, he plans to continue exporting about 20% of his “millions” of dollars in sales to Asia, where he often visits.

“The consumer in China hopefully will look at it again and see that it’s the farmer who is producing,” he said. “We’re just making good product and hopefully they will see past a political situation.”

Bremner added that China’s high-end juice market is different from Canada’s because there’s more competition from juice makers all over the world, whereas in Canada there is little juice available from Australia, for example.

The value of B.C.’s agri-food exports to mainland China dropped by about 2.8% in 2017, but they have risen steadily during the past decade.

gkorstrom@biv.com

@GlenKorstrom