Canola now worth $26.7 billion to Canadian economy

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Canola’s value to the Canadian economy has tripled over the past decade to $26.7 billion a year, according to a new independent analysis released by the Canola Council of Canada. The report shows the canola industry generates a total of 250,000 jobs and $11.2 billion in wages for Canadians, and those benefits are felt from coast to coast.

“There’s been a substantial increase in the benefits from canola that are rippling through the Canadian economy,” says Brian Innes, the Canola Council’s vice president of government relations. “Compared to the previous three-year period of 2009-2011, the total impact of canola has increased by nearly $6 billion.”

The report was developed by LMC International, a leading agri-business research firm. LMC used best practices to estimate the total benefits, jobs and wages that are generated as Canadian-grown canola is developed, grown, processed and marketed. LMC’s calculations were based on data from three crop years: 2012/13, 2013/14 and 2014/15. This is the third time LMC has done an analysis of this kind on the canola value chain.

The latest study shows how dramatically canola’s impact has grown since 2005/06:

The total economic impact has increased by 250%.
The total wage impact has doubled.
Domestic canola processing and refining have expanded significantly and now generate four times the economic impact.
The number of jobs generated by canola has increased by 41%.

In addition, LMC’s analysis showed that jobs linked to canola have higher than average wages. The average salary for jobs generated by canola for this three-year period was $62,000, compared to the average Canadian salary of $50,000.

Innes notes that the influence of canola on Canadian jobs and wages was much steadier over this three-year period, compared to previous years. This stability reflects how canola has matured into a reliable mainstay of the Canadian economy.

The growth of the industry’s impact is driven by a number of factors. Canadian canola production has increased as growers continue to achieve record yields. As the crop is researched, grown, handled, processed and then distributed to customers around the world, more jobs are created within the canola value chain and in sectors that provide goods and services to the industry. When the wages from these jobs are spent, a wide variety of other industries and sectors are stimulated, from real estate to manufacturing to arts and entertainment.

“The canola value chain is working hard to grow these economic benefits by continuing to increase yields, expand into new markets and build on the advantages of our exceptional products,” says Innes. “Canola’s benefits reach across Canada – it’s a source of great pride for our industry.”

LMC found that these effects are felt by Canadians living far from where canola is grown and processed. While the greatest economic benefit is in the Prairies, canola also has a significant impact on the economies of Ontario ($1.48 billion), Quebec ($1.06 billion), British Columbia ($554 million) and the Maritime provinces ($120 million).

LMC studied 11 distinct links in the canola value chain, and found that most of the resulting economic benefits can be traced back to the business of growing canola. In addition to providing a substantial proportion of farm family income, canola production leads to investment in things such as research, variety development, equipment, fertilizer, crop protection products and a wide range of business management services. Every year these activities generate about $16.4 billion in Canadian economic impact.

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