05/01/2019 11:04 EDT | Updated 05/01/2019 15:02 EDT

Canada's Canola Farmers To Get Expanded Financial Aid Amid Trade Dispute With China

Beijing's ban on some Canadian canola shipments is seen as retaliation for the arrest of Huawei's CFO.

OTTAWA — The federal government is changing a payment program for canola farmers to help those affected by China's decision to ban the Canadian product.

The maximum loan limit through the program will be boosted to $1 million from $400,000, and the portion that will be interest-free is rising to $500,000 from $100,000, Agriculture Minister Marie-Claude Bibeau said on Parliament Hill Wednesday morning.

"We stand shoulder-to-shoulder with Canada's canola producers and farm families across the country and we will continue to listen to their needs,'' she said.

"Canada has the best canola in the world as well as a very robust inspection system.''

Watch: Canada's canola feud with China, explained

The government's announcement comes after China barred canola shipments from two of Canada's biggest exporters in what is considered retaliation for the detention of Huawei executive Meng Wanzhou.

China imported $2.7 billion worth of Canadian canola seed last year, and any prolonged blockage will hurt farmers, the industry and the broader economy. The seeds are the raw input for canola oil, used in cooking and industry.

Trade Diversification Minister Jim Carr said he will lead a canola trade mission to Japan and South Korea in early June to help farmers find new markets for their products.

He also said he will be promoting canola in all of his upcoming visits, including in France.

Earlier on HuffPost Canada:

"The Canadian government stands with farming families, our farming communities and industry,'' Carr said. "We will not rest until this situation is resolved for our Canadian producers, workers, and their communities.''

Conservative Leader Andrew Scheer has called for the federal government to take a more confrontational approach with China.

Scheer has called for Canada to appoint a new ambassador to China, launch a complaint about the canola dispute with the World Trade Organization and cut Canadian funding to China's Asian Infrastructure Investment Bank, to which the government has committed $256 million over five years.

Seeking engagement

Citing unproven concerns about pests, China has rejected Canadian canola seed shipments in recent months.

There is agreement across the sector, including with provincial governments and producers, that Canada should engage China on the basis of their allegation, Carr said.

"The basis of their allegation is that there are impurities in canola that has been sent by Canada to China and has been inspected twice by the Canadian Food Inspection Agency,'' he said. "We continue to seek engagement; we are engaging.''