By Hallie Gu and Dominique Patton

BEIJING (Reuters) – China will block pork imports from a third Canadian firm after a shipment was found to contain the banned feed additive ractopamine, the customs agency said on Tuesday, deepening a trade and diplomatic dispute with Canada.

The firm in question is Frigo Royal Inc, the agency said on its Wechat account. Ractopamine is used in some countries to make leaner pigs but China does not allow its use or tolerate residues in imported meat.

China will also strengthen inspections for the residue in all pork imports from Canada, the notice from the General Administration of Customs said. Quebec-based Frigo Royal did not immediately respond to a request for comment.

China halted pork imports from two other Canadian producers, Olymel LP and Drummond Export, in April because of labeling problems. It has also blocked imports of canola.

“It’s definitely not good news,” Canadian Agriculture Minister Marie-Claude Bibeau told reporters, saying food inspectors were investigating the matter.

“My message to the exporters and the industry is to be very vigilant to make sure they respect all the rules of our export agreement with China,” she added.

Relations between China and Canada nosedived last December after Vancouver police detained Meng Wanzhou, the chief financial officer of Huawei Technologies Co, on a U.S. arrest warrant. Beijing is demanding her return.

Canadian officials said this month they had been warned by China that it would step up inspections of meat imports after “recent cases of non-compliance” in pork shipments.

The Chinese customs notice said authorities in the port of Nanjing had detected ractopamine residue in a batch of Frigo Royal pork on June 3.

China had previously warned Canada that it would open all containers of Canadian meat and, in some cases, inspect 100% of the contents.

Many Canadian farmers started raising pigs without ractopamine in 2013 to boost exports to China. Pork exporters, feed manufacturers and hog farms enroll in a government program that certifies pork was produced without ractopamine, said Gary Stordy of the Canadian Pork Council farmer group.

Elanco Animal Health Inc, the manufacturer of Paylean, the commercial name for a ractopamine feed ingredient, does not sell the product in Canada, although there are other ractopamine manufacturers, spokeswoman Keri McGrath said.

In the first four months of 2019, China was Canada’s third-biggest pork export market, taking in C$310 million ($231.41 million) of pork, according to Statistics Canada.

(Additional reporting by Dominique Patton in Beijing, David Ljunggren in Ottawa and Rod Nickel in Winnipeg; Editing by Alistair Bell and Tom Brown)

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