CANADA ECONOMICS

CANADA - CHINA

The Globe and Mail. 28 Jun 2017.  Trudeau dismisses security concerns over Chinese takeover. PM says he saw no need for full-fledged review even though U.S. is now re-examining all Norsat contracts
ROBERT FIFE
STEVEN CHASE 

The reference to taking the advice and respecting the advice of Canadian security agencies is disingenuous given the caution from two former directors of CSIS and David Mulroney … Peter Kent

Conservative foreign-affairs critic

OTTAWA - Prime Minister Justin Trudeau says Ottawa did not compromise national security when it approved a Chinese investor’s takeover of a Vancouver hightech company even though the U.S. Department of Defence has begun reviewing all its business dealings with Norsat International Inc.
Mr. Trudeau told a news conference on Tuesday he saw no need to further scrutinize the purchase of Norsat by China’s Hytera Communications Corp. by subjecting the takeover to a comprehensive national-security review. The Liberal government has faced widespread criticism for skipping a full-fledged review.
“We would not move forward with approving investments under the Investment Canada Act if we were not assured and comfortable that there is no risk to national security. Period,” Mr. Trudeau said.
The U.S. Defence Department announced on Monday that it will review all its contracts with Norsat, which closed a deal last week that will allow it to be swallowed up by Hytera Communications.
Mr. Trudeau was asked whether he could assure the Pentagon there was no security risk for the Americans in the transfer of Norsat’s satellite communications technology to China. The U.S. military is a significant customer of Norsat.
“It doesn’t matter what country it’s from or what deal it is. If there is a risk to national security, we won’t move forward,” Mr. Trudeau said.
“In this case, our very effective national-security agencies made a professional determination that there were no significant national-security concerns about this particular transaction and it didn’t need to go through further reviews.” U.S. critics have raised significant concerns about the deal, including a member of a U.S. watchdog agency that reports to Congress.
Michael Wessel, a member of the U.S.-China Economic and Security Review Commission, which reports to Congress, called for a Pentagon review, saying “the sale of Norsat to a Chinese entity raises significant national-security concerns for the United States as the company is a supplier to our military.”
Congressman Walter Jones, who sits on the House of Representatives armed-forces committee, also called on the Pentagon to review all its contracts with Norsat.
The takeover went through a routine national-security screening that all foreign takeovers of Canadian firms undergo. The government did not ask its security officials to conduct an official national-security review. A more far-reaching probe such as this would analyze the potential impact on Canada’s defence capabilities and investigate how the transfer of this proprietary technology outside Canada might affect this country’s interests or those of its allies. It would also consider how the transaction could enable foreign espionage or injure Canada’s foreign relationships. And it would consider the potential of the investment to hinder intelligence or law-enforcement operations.
“The review they did was adequate to give them confidence that there was no risk to national security. Therefore, their recommendation to the minister was to allow it to proceed, so we did,” Mr. Trudeau added.
Conservative foreign-affairs critic Peter Kent said Canadians should not accept the Prime Minister’s assurances that he accepted the advice of government officials who examined the Norsat deal.
“The reference to taking the advice and respecting the advice of Canadian security agencies is disingenuous given the caution from two former directors of CSIS and David Mulroney, a well-respected former Canadian ambassador to China that in fact, a full national-security review would have been the proper course to follow,” Mr. Kent said.
The Liberal government has made closer ties to China – including a potential free-trade deal – a cornerstone of its foreign policy.
But Mr. Kent said Trump administration officials are concerned that free trade with China will “only open the door wider for potential Chinese dumping of products in North America.” He said the security concerns are even more worrying because “China – if not a potential enemy – is not a democratic ally.”
Mr. Trudeau has said Ottawa consulted Washington before concluding Hytera’s takeover does not pose any nationalsecurity risks. He has refused to say who was consulted in the Trump administration or whether the United States had objected to the sale.
Norsat’s customers include the U.S. Department of Defence, the U.S. Marine Corps, the U.S. Army, the giant aircraft manufacturer Boeing, NATO and Nav Canada, operator of the country’s civil air-navigation service.
Concerns about the deal include the transfer of sensitive technology to China’s militaryindustrial complex as well as the fact that the company was sued by Motorola Solutions over allegations it stole patents and trade secrets.
In a statement provided to The Globe and Mail, Hytera said it “strictly obeys local laws and regulations.”
The company did not respond to questions about the nationalsecurity concerns its Norsat acquisition bid has provoked. Nor did it address how it intends to maintain contracts with clients, including the U.S. military.
Instead, it said that by expanding its footprint through international mergers and acquisitions, the company can gain “clearer insights into local markets, and offer service to local communities.” Hytera wants to “become a trustworthy cooperation partner with the local community and clients,” the statement said.
Mac Thornberry, chairman of U.S. House of Representatives armed services committee, urged Ottawa last week to be “more vigilant” in approving Chinese investor takeovers of Canadian high-tech firms that specialize in military hardware.
Shareholders of Norsat on June 22 voted in favour of the Hytera takeover after the company turned down a competing bid from a U.S. hedge fund. Norsat said in a statement last week that it expects the sale will close by the third quarter of 2017.

The Globe and Mail. 28 Jun 2017. Trudeau: Foreign-affairs critic says Canadians shouldn’t accept PM’s assurances 
With a report from Nathan VanderKlippe

U.S. critics have raised significant concerns about the deal, including a member of a U.S. watchdog agency that reports to Congress.
Michael Wessel, a member of the U.S.-China Economic and Security Review Commission, which reports to Congress, called for a Pentagon review, saying “the sale of Norsat to a Chinese entity raises significant national-security concerns for the United States as the company is a supplier to our military.”
Congressman Walter Jones, who sits on the House of Representatives armed-forces committee, also called on the Pentagon to review all its contracts with Norsat.
The takeover went through a routine national-security screening that all foreign takeovers of Canadian firms undergo. The government did not ask its security officials to conduct an official national-security review. A more far-reaching probe such as this would analyze the potential impact on Canada’s defence capabilities and investigate how the transfer of this proprietary technology outside Canada might affect this country’s interests or those of its allies. It would also consider how the transaction could enable foreign espionage or injure Canada’s foreign relationships. And it would consider the potential of the investment to hinder intelligence or law-enforcement operations.
“The review they did was adequate to give them confidence that there was no risk to national security. Therefore, their recommendation to the minister was to allow it to proceed, so we did,” Mr. Trudeau added.
Conservative foreign-affairs critic Peter Kent said Canadians should not accept the Prime Minister’s assurances that he accepted the advice of government officials who examined the Norsat deal.
“The reference to taking the advice and respecting the advice of Canadian security agencies is disingenuous given the caution from two former directors of CSIS and David Mulroney, a well-respected former Canadian ambassador to China that in fact, a full national-security review would have been the proper course to follow,” Mr. Kent said.
The Liberal government has made closer ties to China – including a potential free-trade deal – a cornerstone of its foreign policy.
But Mr. Kent said Trump administration officials are concerned that free trade with China will “only open the door wider for potential Chinese dumping of products in North America.” He said the security concerns are even more worrying because “China – if not a potential enemy – is not a democratic ally.”
Mr. Trudeau has said Ottawa consulted Washington before concluding Hytera’s takeover does not pose any nationalsecurity risks. He has refused to say who was consulted in the Trump administration or whether the United States had objected to the sale.
Norsat’s customers include the U.S. Department of Defence, the U.S. Marine Corps, the U.S. Army, the giant aircraft manufacturer Boeing, NATO and Nav Canada, operator of the country’s civil air-navigation service.
Concerns about the deal include the transfer of sensitive technology to China’s militaryindustrial complex as well as the fact that the company was sued by Motorola Solutions over allegations it stole patents and trade secrets.
In a statement provided to The Globe and Mail, Hytera said it “strictly obeys local laws and regulations.”
The company did not respond to questions about the nationalsecurity concerns its Norsat acquisition bid has provoked. Nor did it address how it intends to maintain contracts with clients, including the U.S. military.
Instead, it said that by expanding its footprint through international mergers and acquisitions, the company can gain “clearer insights into local markets, and offer service to local communities.” Hytera wants to “become a trustworthy cooperation partner with the local community and clients,” the statement said.
Mac Thornberry, chairman of U.S. House of Representatives armed services committee, urged Ottawa last week to be “more vigilant” in approving Chinese investor takeovers of Canadian high-tech firms that specialize in military hardware.
Shareholders of Norsat on June 22 voted in favour of the Hytera takeover after the company turned down a competing bid from a U.S. hedge fund. Norsat said in a statement last week that it expects the sale will close by the third quarter of 2017.

The Globe and Mail. 28 Jun 2017. China assails Tory Leader over pledge to fight free-trade talks
ROBERT FIFE
STEVEN CHASE
With reports from Xiao Xu in Vancouver, Nathan VanderKlippe in Beijing and Reuters

Communist Party newspaper says Scheer demonstrates ‘faulty logic’ with his opposition to negotiations

JUSTIN TANG/THE CANADIAN PRESS

OTTAWA - Chinese newspaper Global Times is highly critical of Conservative Leader Andrew Scheer, seen in Ottawa on June 21, for opposing a free-trade deal between Canada and China.
Beijing’s ruling Communist Party has used one of its main newspapers to deliver an angry salvo at Conservative Leader Andrew Scheer, calling him “arrogant and biased” for opposing a trade deal between China and Canada.
The Official Opposition Leader announced on Sunday that his party would oppose Prime Minister Justin Trudeau’s effort to negotiate a free-trade accord with the world’s second-biggest economy, citing concerns about human rights, labour standards and the fact the Chinese economy is dominated by state-owned companies. Canadian and U.S. intelligence agencies have warned these enterprises act in the interests of China’s Communist Party.
“Giving China preferential access to the Canadian market would threaten the jobs of workers and businesses in this country,” Mr. Scheer said.
On Monday, the Chinese newspaper Global Times, a stridently nationalist media outlet owned by the Communist Party, published an article saying Mr. Scheer is demonstrating “faulty logic and blindness” to the benefits of a bilateral trade pact.
“The opposition leader’s statement shows nothing but his arrogant and biased attitude toward China,” according to the article written by Global Times journalist Wang Jiamei.
“Scheer’s logic is beguiling but wrong.”
The columnist said it was unfair of Mr. Scheer to compare Canadian labour, environmental and human-rights standards to China, which he said remains a developing country.
“If Canada requires a potential FTA [free-trade-agreement] partner country to have the same ideology and labour standards as itself, then it should probably only look at Western countries,” he said. “Few developing countries could meet Mr. Scheer’s standards for a level playing field.”
Citing two corporate lobby groups in Canada, Mr. Wang pointed to the increase in business Australia and New Zealand enjoyed after they concluded free-trade deals with China. Canada’s economy would similarly prosper if a trade deal was negotiated, he predicted.
“A China-Canada free-trade agreement would increase Canada’s GDP by 7.8 billion Canadian dollars … boost its exports by 7.7 billion Canadian dollars and add 25,000 jobs by 2030, according to a 2016 white paper released by the Canada-China Business Council and the Canadian Council of Chief Executives,” he wrote.
Jack Jia, publisher of Chinese News in Toronto, said he believes the Global Times article is aimed in part at ethnic Chinese in Canada.
“They want to tell Chinese Canadians, ‘We don’t like this guy. Don’t get along with this guy,’ ” Mr. Jia said.
Conservative foreign-affairs critic Peter Kent said Mr. Scheer is merely alerting Canadians to what the Official Opposition sees as the potential pitfalls of negotiating free trade with China, from turning a blind eye to Chinese acquisition of sensitive military technology to ignoring human-rights abuses.
“The Chinese government has given every impression that it is successfully bullying the Liberals into getting what they want and the Liberals seem to be accepting it,” the MP said.
He noted the Liberals have muted their criticism of China’s human-rights record ever since Beijing’s new envoy to Canada, Lu Shaye, warned that his country would not allow the issue to be part of any free-trade talks.
David Mulroney, a former Canadian ambassador to China, said the Global Times has a mandate to attack overseas critics.
“This is par for the course for the Global Times, which is given fairly free rein to go after foreign governments and foreign officials who are seen to be antiChina,” Mr. Mulroney said in an interview.
“China is much more comfortable attacking Canadian Conservatives, whom it considers pretty much irrevocably unfriendly than Liberals, who are seen as old friends.”
Beijing has been advancing the position for some time that it is profitable for Western countries such as Canada to trade with China. Mr. Mulroney said Canadians should not lose sight of what is going on inside the country.
“The biggest story out of China today is that Nobel Prize winner Liu Xiaobo appears to be dying of cancer. He has been released from official confinement but will almost certainly die a prisoner of the state, something that last happened to a Nobel laureate in Nazi Germany in the 1930s,” Mr. Mulroney said. “It’s getting hard to normalize relations with an increasingly abnormal China.”
The Liberal government is in exploratory talks with Beijing over whether the two sides can negotiate a broad trade deal.
Mr. Scheer is accusing the Liberal government of wanting to “appease” China, pointing to controversial Chinese investments – including Hytera Communications Corp.’s acquisition of Vancouver satellite-maker Norsat International Inc. He said the Trudeau cabinet’s approval of the deal – without a comprehensive national-security review – is an example of a troubling pattern in which Ottawa appears to be overly eager to win Beijing’s favour.
“What I’m worried about is that these are steps that the Liberals are doing to appease the Chinese government before freetrade negotiations even start,” he told CTV’s Question Period in an interview that aired last Sunday.
“To put Canadian manufacturers and workers at a disadvantage to Chinese competition that don’t have to play by the same playing rules, that’s not in Canada’s best interests,” he said.
The U.S. State Department on Tuesday placed China on its global list of the worst offenders in human trafficking and forced labour.
A report from the State Department said China convicted fewer sex and labour traffickers in the 12 months ended on March 31 than in the previous year, forcibly repatriated North Koreans without screening them for indicators of trafficking, and handled most forced labour cases as administrative issues rather than criminal prosecutions.

ECONOMY - G7

BLOOMBERG. 2017 M06 28. Trudeau Curbs His Economic Enthusiasm Despite Canada Leading G-7
By Josh Wingrove

• Child benefits and fire response seen as one-off boosts to GDP
• PM hails jobs gain but warns against month-to-month milestones

Canada’s economy is booming, though you’d hardly know it from listening to Prime Minister Justin Trudeau.

Led by a soaring housing sector and consumer spending, Canada’s gross domestic product is forecast to lead the Group of Seven this year. Jobs numbers are surging, the central bank is hinting at rate hikes and a new round of GDP figures this week will likely show the expansion continues.

It’s the type of liftoff Trudeau’s government foretold when it broke from a generation of the country’s balanced-budget orthodoxy and pushed further into deficits. Since February, “no major country or economic region has enjoyed as positive a string of economic surprises as Canada,” Warren Lovely of National Bank Financial wrote on June 13.

And yet it’s something Trudeau has rarely mentioned before this week, when he celebrated Canada’s addition more than 300,000 jobs over the past 12 months. Even then, he stopped short of claiming credit -- saying numbers could slip month-to-month and that his growth plan is still in its early stages.

“We don’t see the value in touting and waving around any given month’s positive numbers when we know the next month might be a slight dip and the month after that might be a slight rise,” the prime minister said Tuesday in Ottawa. “Our focus as a government is very much on the long-term.”

He also alluded to uncertainty facing Canada, saying the world is in a “time of transition.” No government wants to tie itself to an economy facing headwinds that could cool things off, and in Canada the risks are clear -- oil prices are slumping, fears of a housing correction abound, rising rates could hit consumer spending and President Donald Trump’s administration is rattling its saber on trade.

“It looks like the party that’s been going on for a while isn’t going to stop any time soon,” Randall Bartlett, chief economist for the University of Ottawa’s Institute of Fiscal Studies and Democracy, wrote in a report this month. “But the party can’t last forever.”



Statistics Canada reports April GDP data on Friday, and economists predict it gained 0.2 percent on the month and 3.4 percent from a year earlier. The latter would be the fastest pace since June of 2014.

Trudeau isn’t the only official shy about the growth and jobs data. When asked this month if he takes credit for the uptick, Finance Minister Bill Morneau said his government’s deficit spending plan is spurring job growth and consumer confidence in particular, while warning there’s more work to be done.

“Our approach is starting to have the impact on the economy that we were hoping to have,” he told reporters this month, hailing a budget that advances plans for infrastructure spending. “We’re making a difference and we want to move forward to the next step.”

Part of Trudeau’s reticence may stem from political pledges. He was the only major party leader in the 2015 election to pledge deficits because he said government needed to stoke growth.

Morneau’s debut budget projected that program spending would add 0.5 percentage points to growth in the fiscal year that ended March 31, and 1 percentage point in the current year. The country isn’t on pace for that, instead tracking to add about 0.4 percent in 2017, Toronto-Dominion Bank economist Brian DePratto said, adding “it’s hard to see a whole lot of impact” from government measures so far.

Trudeau himself said Tuesday that’s by design -- and his government has always avoided casting its plan as stimulus. Infrastructure spending, for example, will “take a while to get rolling, take a while to have that positive impact,” the prime minister said.

Down to Earth

The pick-up in Canadian growth -- particularly with government spending playing a less-than-forecast role -- could cast doubt on Trudeau’s reasoning for deficits. And yet there are persistent risks with Canada’s economy entering what DePratto called a transition period.

“Having that government support in there keeps that growth rate strong,” he said. “If you lose one of those drivers, having government sit as a bit of a backstop to growth -- there’s something to be said for that.”

One key measure taken by Trudeau was an overhaul and expansion of child benefit payments -- in effect, funneling more money to low-income parents. It has provided a one-time boost since last summer and won’t continue to add new growth each year. Trudeau alluded to it Tuesday as a factor that will pay long-term dividends.

Recovery from major fires last year in the heart of Canada’s oil patch, Fort McMurray, is also giving a short-term boost to GDP. Canada is on track for real GDP growth of 2.5 percent in 2017, the best in the Group of Seven, with the U.S. coming in second at 2.2 percent, data compiled by Bloomberg show.

Smaller Shortfalls

Interest rates are set to increase and there are signs that the housing market is finally cooling, signaling that residential investment will “pull back as a driver of growth going forward,” Bartlett wrote. Gains in trade and business investment won’t be enough to offset the change and growth will slow after this year as “the Canadian economy comes back down to earth,” he wrote.

Federal measures may not stave off a slowdown -- for instance, there’s no evidence that major infrastructure spending has begun and the federal plan is spread over so many years “that it won’t produce much short-term bang for the buck,” he wrote.

Continued strength in the Canadian economy could be a political victory for Trudeau, who faces regular attacks from rival politicians for deficits of nearly C$30 billion ($23 billion), or three times the scale of what he campaigned on. Asked Tuesday when he would return to a balanced budget, Trudeau declined to give a date. He reiterated his government’s desire to “focus on the investments needed to grow the economy” instead of “balancing the books arbitrarily and at all costs.”

The improving economy will cut the Canadian deficit by a cumulative C$12.9 billion from this year’s budget through to the 2019-2020 fiscal year, which will be Trudeau’s pre-election budget, Lovely forecast in his report earlier this month. Risk factors such as housing and U.S. policy uncertainty still threaten to cool things down.

“For now, however, Canada’s surprisingly robust expansion gives the federal government greater latitude,” including to come in with a smaller deficit, Lovely wrote. “And that’s not a bad place to be.”

SOFTWOOD LUMBER

The Globe and Mail. 28 Jun 2017. There’s no summer vacation for Canada on the trade file
COLIN ROBERTSON

Since the initial Trudeau-Trump meeting, there has been a veritable flood south of Canadian ministers, provincial premiers and legislators from all levels of government to Washington and throughout the United States, especially into Trump territory. They carry the message of mutually beneficial, job-creating trade and investment with the reminder that we are also steadfast allies and good neighbours.

Vice-president and fellow at the Canadian Global Affairs Institute and former diplomat

DARRYL DYCK/THE CANADIAN PRESS

There is more acrimony this week around the Canada U.S. trade relationship as the softwood-lumber dispute comes to a boil. This week’s antidumping levies, on top of the countervail duties already applied, should serve as a wakeup call to affected provinces to get their act together.
The U.S. Lumber Coalition cleverly differentiated between Canadian companies operating in different provinces. The overall marginal rate only aggravates the differing perspectives: interior versus coastal British Columbia (the province with the most at stake), Alberta, Ontario, Quebec and New Brunswick.
The political situation in British Columbia has created complications, but it should not prevent the respective provincial “wise persons” – David Emerson (B.C.), Gary Doer (Alberta), Jim Peterson (Ontario), Raymond Chrétien (Quebec) and David Wilkins (New Brunswick) – getting together and figuring out a common position.
Then they need to sit down with the U.S. Lumber Coalition. If they can work out a deal, they can expect a rapid blessing by the national governments, both of which would prefer softwood lumber out of the way before the renegotiation of the North American free-trade agreement.
The NAFTA clock is already ticking. The U.S. Trade Promotion Authority requires the Trump administration to publish a detailed summary of its negotiating objectives and expected “positive” outcomes 30 days before Aug. 16, the earliest date that the negotiations can begin.
Both the Mexicans, who fear unfinished negotiations could affect their presidential election (July, 2018), and the Americans, who want it done before their midterm elections (November, 2018), want a quick deal. It is possible, especially as President Donald Trump seems more interested in deal-making than rule-making.
Hearings this week in Washington, hosted by the U.S. Trade Representative (USTR), will supplement the 12,453 written comments already submitted and available online. The U.S. process has its critics, but we could learn from its transparency.
The government of Justin Trudeau has positioned itself well for the coming negotiations. Even if Mr. Trudeau and Mr. Trump disagree on fundamentals such as climate, migration and multilateralism, they can speak frankly. This is important, especially as most Canadians, and the citizens of our friends and allies, dislike Mr. Trump.
The Trudeau-Trump agenda, set at their February meeting, focuses on creating middle-class jobs and on areas of shared interests: defence, shared infrastructure, border preclearance, energy security, joint regulatory reform and empowering female entrepreneurs.
Their agenda is making headway.
The Trump administration quickly permitted the Keystone XL pipeline. Empowering female entrepreneurs earned a shoutout in Mr. Trump’s address to Congress. The Trudeau government will increase defence spending from 1 per cent to 1.4 per cent of GDP. It still needs to move on its preclearance legislation (Congress passed its legislation last December).
Progress will also depend on the deep and profoundly tangled web of personal relationships that have long characterized Canada-U.S. relations matters.
As Franklin Roosevelt once observed, ours is a “forthright fellowship with neighbours who are also friends.”
Since the initial Trudeau Trump meeting, there has been a veritable flood south of Canadian ministers, provincial premiers and legislators from all levels of government to Washington and throughout the United States, especially into Trump territory. They carry the message of mutually beneficial, jobcreating trade and investment with the reminder that we are also steadfast allies and good neighbours.
This week, with strong stakeholder encouragement, Western premiers and Ambassador David MacNaughton are meeting with their counterparts in Montana to discuss joint economic development, including integrated supply chains, energy and practical matters, such as wildfires and forest management. Similar regional meetings throughout the summer underline the value of personal relationships.
This is not to say the road to a new deal will not have a few bumps. Mr. Trudeau may not have a Plan B, but his government, in tandem with Mexico, is wisely preparing a list of punitive trade actions directed at U.S. congressional leadership on both sides of the aisle that we can take if the negotiations go off the rails.
As we learned in the country-of-origin dispute, Americans need to understand that protectionism has a cost.
With common sense, we can avoid begger-thy-neighbourism.
Happily, the Canada-U.S. relationship has very stable foundations. Its pillars are our shared institutions and the hundreds of agreements, some dating back more than a century, embracing all levels of government. Despite all the recent noise, we need to keep in mind that, in a world in disarray, the two countries continue to be a model of neighbourly relations.

BRAZIL - MEAT IMPORTS

REUTERS. Jun 28, 2017. Canada tightens inspections of imported Brazil meat
By Rod Nickel

WINNIPEG, Manitoba (Reuters) - Canada has stepped up inspections on imported meat from Brazil to temporarily check every shipment following a corruption investigation involving Brazil's health inspectors, the Canadian Food Inspection Agency (CFIA) said.

The new protocols, which started on April 10, involve full inspection of all Brazilian meat imports on five consecutive shipments from each approved plant and for each product category, CFIA spokeswoman Maria Kubacki said.

Canada is a small buyer of Brazilian beef, importing C$21 million ($16.1 million) worth of its beef and veal last year, according to Agriculture and Agri-Food Canada.

Full inspections by Canada include analysis for pathogens in ready-to-eat meat products, chemical residue testing and further analysis of containers used for canned meats.

Previously, CFIA conducted one full inspection randomly out of 10 consecutive shipments from each specific Brazilian establishment. The other nine shipments were visually inspected.

Brazilian police raided the premises of global meatpacking companies JBS SA and BRF SA in March, as well as dozens of smaller rivals, over suspected bribery of health officials..

The United States last week banned imports of fresh Brazilian beef after a high percentage of shipments failed safety checks.

Canada has rejected six shipments of Brazilian beef out of 191 meat shipments since April 10, according to CFIA. It blocked imports in May from one JBS plant in Brazil that did not meet food safety requirements, and delisted two others in March.

The rejected shipments had metal can defects which could lead to spoilage.

The U.S. ban on fresh Brazilian beef imports will not likely create much opportunity for Canadian beef shippers selling to their neighboring country, said Dennis Laycraft, executive vice-president of Canadian Cattlemen's Association. Brazilian fresh beef is more similar to that produced by Australia and New Zealand, where cattle are raised mostly on grass, than Canadian beef, he said.

($1 = 1.3088 Canadian dollars

(Reporting by Rod Nickel in Winnipeg, Manitoba; editing by Grant McCool)

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LGCJ.: