Over the past 40 years, canola production has risen meteorically worldwide, spurred by the growing use of vegetable oils in China and India and canola-oil-based biodiesel use in the EU.
It used to be the sixth largest oil crop, now it is the second largest in the world. With rising global demand for canola seeds and canola oil, its production is expected to increase by 40% by 2025. Canola oil exports have more than doubled in the last decade as well.
Canada is the world’s largest producer and exporter of Canola oil. More than 43,000 Canadian farmers grow canola and the canola industry brings in $19.3 billion for the country in 2013. In 2013, Canada produced 18 million tons of Canola (a 29% increase in yield). The top Canadian region was Saskatchewan, followed by Alberta and Manitoba. The leading importer of Canola from Canada is China, followed by Japan and Mexico. Canada annually exports around 800,000 tons of canola oil. The bulk of Canola oil is transported to United States, with small quantities going to Mexico, China and Europe.
The U.S. and Canada together produce around 7 to 10 million metric tons of canola seeds annually.
The U.S. is a small but growing player in the canola industry. Canola is a cash crop in the U.S. and has been grown since the Second World War. However, it is still regarded as a new crop in the U.S. where it is generally grown during the spring.
90% of the canola in the U.S. is grown in North Dakota, with the rest growing in the Pacific Northwest and Northern Plains.
The U.S. consumer more canola than it produces, however it is able to export some quantity of canola oil to Japan, Mexico and China. It also buys the bulk of Canada’s canola oil.
In the past few years, the demand for canola oil has also seen a surge in the biodiesel industry in the EU. This is why EU is a major importer of canola oil from Ukraine and Russia. Ukraine has been steadily expanding its canola production and is now the second largest exporter in the world.
How is Canola oil Used?
Most of the Canola in the world is consumed by the U.S., China, Japan, Mexico and Pakistan.
The U.S. consumption of canola oil was over 2,800 million pounds in 2008, while production was around 1,000 pounds. The U.S. consumed around 3 billion pounds of canola oil in 2010—out of which 2.5 billion was imported from Canada.
The U.S. is the biggest importer of canola oil. Due to strong demand from the U.S. for canola oil, approximately 70% of Canada’s canola oil is exported to the U.S where even some fast food chains like KFC, Taco Bell and McDonalds have started using canola oil in preparing their food.