Despite a global pandemic and world-wide economic recession, Saskatchewan posted record agricultural exports and led the nation in overall export sales growth in 2020.
Not content to rest on its laurels, the province is doubling down on last year’s strong performance by opening not one, not two, but three new trade offices in Southeast Asia and India in the first quarter of 2021.
These new trade offices in Singapore, Tokyo and New Delhi are in addition the province’s existing trade office in Shanghai, which services the People’s Republic of China (PRC), Saskatchewan second-largest export market, behind the U.S.
Trade and Export Development Minister Jeremy Harrison says he was pleasantly surprised with the 2020 trade numbers, which saw $16.9 billion in agricultural exports—a more than 30 per cent increase from 2019 and more than half of the province’s total exports of $30.4 billion.
“We really do continue to have what the world needs,’’ Harrison said in a recent interview for Industry West Magazine. “The world needs food, the world needs energy and the world needs the means to grow that food. That is something we are very blessed to have in a tremendous quantity.’’
Saskatchewan’s exports are dominated by the three “Fs”—food, fuel and fertilizer—led by $6 billion in potash sales and $6 billion in canola seed, oil and meal, followed by $5 billion in oil and gas, $4.5 billion in wheat and $3.4 billion in pulse crops.
“Honestly, it was really remarkable—even to me and our professional managers and staff here at Trade and Export Development—to see that we were able to increase those exports year-over-year, considering that we had supply chain disruptions, issues in international credit markets, a whole bunch of impediments and challenges.’’
Among those challenges were suspensions of canola shipments to China in March 2019 due to alleged contamination and a dispute with India over pulse shipments from Canada dating back to March 2017.
Avoiding costly trade disputes was one of the reasons behind the Saskatchewan Party government’s decision to set up new trade offices in Singapore to serve Southeast Asia, Tokyo for the Japanese market and New Delhi for the huge Indian market. The Shanghai office will also get new leadership.
Harrison says the government wanted professional, experienced trade diplomats—not former politicians—to staff the new trade offices.
“We wanted to find the best people that we possibly could to staff those offices. And we hired people with tremendous international experience that are really going to be professional and able to function in advancing our trade and economic interests in market and have proven track records of doing so.’’
The New Delhi office will be led by Victor Lee, a 10-year international trade veteran, who served as director of trade and investment for the Asia Pacific region for the province of Alberta. India, the world’s second-largest country, with 1.3 billion people, is Saskatchewan’s fourth-largest market at more than $1.2 billion in trade annually.
Also from the ranks of Alberta’s trade officer corps is Winston Kan, the new manager of Saskatchewan’s China office in Shanghai. Previously, Kan served as managing director of Alberta’s Beijing office, where he led trade and investment activities and managed commercial officers in several major cities in the region. China is Saskatchewan’s second-largest export market, with $4.1 billion in trade in 2020.
The new Singapore office, which will serve the Southeast Asia region, including Malaysia, Philippines, Vietnam, Indonesia and Thailand, will be headed by Greg Eidsness. The Swift Current native has 15 years of experience, including director of international market development for the B.C. Ministry of International Trade.
Saskatchewan merchandise exports to the Association of Southeast Asian Nations (ASEAN) totalled $1.2 billion in 2019, including potash, wheat, wood pulp, peas and canola seed.
Finally, Paul Pryce will serve as the managing director of the Tokyo office. Pryce has seven years of experience in Japan’s Ministry of Foreign Affairs as principal advisor to the Consul General of Japan in Calgary, which included responsibility for Saskatchewan.
Japan is Saskatchewan’s third-largest export market, with $1.2 billion in export sales in 2020, up more than 60 per from a decade ago. Top commodity exports to Japan were canola seed, wheat, barley and malt.
Harrison, who has been minister responsible for trade for nearly a decade, knows the value of having “boots on the ground’’ in foreign markets.
“I saw it, first-hand, where other provinces do have staff on the ground. They were first in line. They had built those relationships over long periods of time,’’ Harrison says, noting that Alberta has had trade offices in Japan for 50 years.
“In a lot of these economies, those relationships are as important as the commercial transaction.’’
Of course, trade offices don’t come cheap. “It’s about a $1 million per office per year. It’s an investment that’s substantial,’’ Harrison says.
But Harrison believes that increased trade will more than pay for the cost of setting up and operating the three new trade offices, as well as staffing the existing Shanghai office for mainland China trade.
Harrison says the trade offices will also help achieve the province’s Growth Plan-2030 target of increasing agricultural exports to $20 billion by 2030. “So we’re well on our way to being there, at nearly $17 billion (in agricultural exports in 2020).”
Many commodity groups and industry associations agree having trade offices in these key markets is a good investment that will pay dividends for Saskatchewan exporters for years to come.
Ryder Lee, CEO of the Saskatchewan Cattlemen’s Association, says having a Saskatchewan trade office will help the beef cattle industry serve its traditional markets of Japan and China, as well as emerging markets in Southeast Asia and India.
“More resources generally get more done,’’ Lee said in an interview with IW. “Having somebody who can help you wade through what is the market access challenge of the day… is important,’’ Lee says.
Tim Gitzel, president and CEO of Cameco, noted all four Saskatchewan international trade offices serve markets that are important in the global nuclear energy industry and to Cameco, in particular.
Cameco has long-term uranium supply contracts in place with the two main Chinese electrical utilities, while the Saskatoon-based company recently concluded a supply agreement to deliver large volumes of Saskatchewan uranium to fuel India’s reactor fleet.
Japan has been one of Cameco’s top customers for decades, while the Singapore office will serve Southeast Asia, which is seen as a growth market for nuclear energy.
“We see real value in the international engagement work that is being done by our provincial government,’’ Gitzel says. “We’re therefore very supportive of the strategy to establish international trade offices in key markets for the province’s goods and services.”
“We’re really pleased see Saskatchewan open trade offices in those two markets in particular. That’s going to be so beneficial to our ongoing pulse trade with those countries,’’ Loessin said in a recent interview.’’
Pulse producers have faced several trade disruptions, most importantly the fumigation issue with India dating back to 2003-04.
“You can’t overestimate the importance of relationships with these major trading partners,’’ adds Loessin, who attended a trade mission to India with former premier Brad Wall a few years ago.
Saskatchewan canola producers and processors, who exported $3.6 billion in canola seed, $1.7 billion in canola oil and $800 million in canola meal in 2020, are equally excited about the new trade offices.
Bernie McClean, chair of SaskCanola and a director of the Canadian Canola Growers Association, said the trade offices can help the canola industry avoid “market disruptions,” like the two-year-old dispute with China over alleged contamination of canola shipments.
“Having boots on the ground” in those export markets can help to defuse situations before they become fully blown trade disputes, McClean says from his farm near Glaslyn.
“These offices will serve a very useful purpose for the canola industry, especially in Saskatchewan.’’
Saskatchewan wheat producers, who exported $4.5 billion worth of wheat last year, are also supportive of the new trade offices.
“We have to show the world that Saskatchewan is open for business,” says Cherilyn Nagel, a Mossbank farmer, director and former president of the Western Canadian Wheat Growers Association. “There’s nothing that says I want to do business with you like setting up a business in your backyard!”
In the 2021-2022 Provincial Budget, the Government of Saskatchewan announced plans for four more international trade offices with locations to be announced in the coming months.
Update: The Government of Saskatchewan announced on May 12, 2021 that the new offices will be located in London, United Kingdom; Dubai, United Arab Emirates; Mexico City, Mexico; and, Ho Chi Minh City, Vietnam.