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U.S. trans fat ban creates opportunities for canola

(Photo courtesy Canola Council of Canada)

CNS Canada — A move by the U.S. Food and Drug Administration to ban artificial trans fats in processed foods within three years will create opportunities for Canada’s canola sector, especially high oleic varieties such as Nexera.

Partially hydrogenated oils (PHOs), which are the primary source of artificial trans fat in processed foods, are not “generally recognized as safe” (GRAS) for use in human foods, the FDA said in its announcement Tuesday.

The ban “is expected to reduce coronary heart disease and prevent thousands of fatal heart attacks every year,” FDA’s acting commissioner Dr. Stephen Ostroff said in a release.

The U.S. rules are also expected to create increased demand for products that can replace PHOs.

“It’s good news for canola,” said Dave Dzisiak, commercial director of grains and oils for Dow AgroSciences in Calgary.

Labeling requirements the FDA set up in 2006 have already served to reduce the amount of trans fats used in the U.S. and raise the usage of high oleic Canadian canola oil, but Dzisiak said there were still an estimated two billion pounds of PHOs being used in the country — a figure that would represent roughly 2.5 million acres of canola.

The taste, texture and shelf-life attributes of PHOs can’t be replaced by regular canola oil, but the high oleic varieties that command a premium in the market provide a good alternative, he said.

“Any of that market share we can get is a net gain for total canola,” said Dzisiak, noting the U.S. already represents the largest market for Canadian canola oil.

Canola oil was second only to soyoil in U.S. food industry usage, with demand having risen significantly over the past five years due to trans fat concerns and regulations.

While there is a three-year deadline for implementation of the FDA ban and food processors will have the option to petition for specific approvals, the reduction of PHOs will likely happen earlier, as most companies will want to get trans fats out of their ingredient lists as soon as possible for public relations reasons, said Dzisiak.

Some applications have proven difficult for removing artificial trans fat, and there are few adequate substitutions for PHOs. Both corn and sunflower oil are possibilities, but Dzisiak said room for expansion was minimal on those fronts.

Canola, meanwhile, “is a very scalable crop,” he said.

About 10-15 per cent of Canada’s canola crop is now seeded to high oleic varieties, which means there is plenty of room for adjustment in acres. The Canola Council of Canada has targets in place that would see high oleic specialty canola account for 33 per cent of seeded acres by 2025.

“The canola industry is well positioned to provide the appropriate products to take the place (of PHOs),” said Chaunda Durance-Tod, the council’s CanolaInfo manager.

“We’ve been aware that this (FDA announcement) has been in the works, and the industry has been ramping up,” she added, noting “there are not a lot of other competitors already in the market.”

The soybean industry wants to get approval for high oleic soybeans, which would compete directly with high oleic canola oil, said Dzisiak.

However, regulatory approvals for those crops remain hung up in Europe and China, allowing canola the opportunity to gain market share and become established as the commercial standard.

“Once you’re the incumbent, you’re more difficult to unseat,” said Dzisiak, “so we have a window of opportunity to capture as much of that share as we can.”

In Canada, current Health Canada regulations limit trans fat content to two per cent in vegetable oil and margarine, and five per cent for all other foods. Labeling rules are also in place.

Phil Franz-Warkentin writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.


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