Your Reading List

Invest In Market Development

As any farmer who ever came up with an idea for a better gate latch knows, just because you have a good product doesn’t mean it is easy getting it into the marketplace. Canola is in the same situation. Producing more canola is one thing. Getting canola oil widely adopted in the North American food market is another, say speakers addressing the annual Canola Council of Canada (CCC) conference in Toronto in March.

Canola oil is now the number two oil in the United States, which is a huge achievement, says JoAnne Buth, CCC president. But being number two is still a long way from being number one. The U. S. uses about one million tonnes of canola oil per year — with corn and sunflower oil close behind. The U. S. market giant is soybean oil, with consumption of 8.5 million tonnes.

At least market share for canola is moving in the right direction. The U. S. used about 24.5 billion pounds of all vegetable oils in 2004-05 and that increased to 27.7 billion pounds of all vegetable oils in 2008-09.

Tom Erikson, vice-president government affairs for Bunge North America, says soyoil has not only lost market share in those four years. It also saw a 10 per cent drop in sales volume. “At the same time canola oil has gained two per cent in market share and nearly 10 per cent in volume (746 million pounds),” he says.


Canola oil has earned an excellent health claim from the U. S. Food and Drug Administration (FDA), which appeals to increasingly health conscious consumers. However there are awareness issues, pricing issues, manufacturing issues and regulatory issues in Canada and the U. S. that all need to be navigated or changed for canola oil to capture more market share.

The health claim, which the FDA approved for use on canola products states: “Limited and not conclusive scientific evidence suggests that eating about 1 tablespoons (19 grams) of canola oil daily may reduce the risk of


“Competitor nations are building responsive regulatory architecture

to support agri-food growth and innovation and Canada isn’t.”

coronary heart disease due to the unsaturated fat content in canola oil. To achieve this possible benefit, canola oil is to replace a similar amount of saturated fat and not increase the total number of calories you eat in a day. One serving of this product contains [x] grams of canola oil.”

Backed by that claim, the Canola Council of Canada is promoting canola to North American consumers on several fronts, says Robert Hunter, CCC vice-president of communications.

“Surveys show consumers are willing to pay more for products that carry the canola oil heath claim,” says Hunter. About 48 per cent of consumers surveyed said they are willing to pay “a little more” for a product with that claim, while four per cent said they are willing to pay “a lot more.”

Success in increasing awareness includes articles on the health benefits of canola oil that appeared in magazines and newspapers such as The New York Times, Women’s Health, Glamour and Body + Soul. The CCC has also enlisted the services of Olympic Gold Medalist Janet Evans. She endorses canola-based recipes, which appear on the canolainfo.orgwebsite. And the council also has developed strategic partnerships with organizations such as the National Heart, Lung and Blood Institute in the U. S. and the Canadian Heart and Stroke Foundation.


While the oil is well positioned, one of the road blocks for wider adoption is in food processing, says Paul Brisebois, assistant vice president marketing and sales with Richardson Oilseed in Winnipeg.

Consumer attitudes are changing, he says. Research shows calorie consumption is up 27 per cent since 1970, with 34 per cent of Americans and 24 per cent of Canadians being obese. At the same time more than half of the baby boomer generation (50 years of age and older) is concerned about avoiding saturated fats, trans fat and cholesterol.

While more food processors are moving to remove vegetable oils high in trans fat, that doesn’t necessarily mean they convert to using canola oil.

“A task force established by Health Canada to monitor trans fat use, shows that food processors and manufacturers of packaged goods are doing a good job at reducing their use of oils containing trans fats,” he says. “But in industrial baking that can be a tough issue. It can be difficult to covert recipes and still keep the taste. To reduce trans fat, a quick solution is to increase palm oil which has seven times more saturated fat than canola oil.”

For consumers concerned about healthier food choices trans fats may be reduced, but saturated fats are higher.

Brisebois says there is good opportunity for canola in the food processing industry. Specialty canola oil such as Nexera, which is high in Omega 9, has a good fit with healthier food choices. In plant breeding, he says the next generation of canola seed development needs to focus on developing varieties low in saturated fats and high in Omega 3 oils. And food processors need to invest more in research and development to better understand and use the intrinsic value of canola.


An improved regulatory framework is needed in Canada as well, says Derek Nighbor, senior vice president, public affairs, with Food and Consumer Products Canada (FCPC).

Canadian food manufacturers want to improve the health benefits of food, but the approval system through Health Canada is slow and outdated.

With food fortification for example, “Canada has no regulatory framework for discretionary fortification of food and beverages, despite a review started in 1998 and a draft policy announced in early 2005,” he says. “That weakness alone is costing the beverage industry about $400 million per year.”

Nighbor also says approvals for use of novel foods and additives routinely take “significantly longer” in Canada than in other jurisdictions. And limits on including ingredient health claims on product labels is also costing the industry dearly. Health Canada started consultations in 2007 on a health claim framework, but there was no clear timeline for action.

“The U. S. has invested heavily and has a flexible claim approval policy, that allows qualified claims, backed by scientific consensus, to be used,” says Nighbor. “These health benefit claims are key to obtaining price premiums for processors and farmers.”

“Competitor nations are building responsive regulatory architecture to support agri-food growth and innovation and Canada isn’t. Health Canada and Agriculture and Agri-Food Canada say modernization of the regulatory framework is a shared priority, but progress is slow. Meanwhile investment goes elsewhere.”

Lee Hart is a field editor for Grainews in Calgary, Contact him at 403-592-1964 or by e-mail at [email protected]

About the author

Field Editor

Lee Hart

Lee Hart is editor of Cattleman’s Corner based in Calgary.



Stories from our other publications