So, what happens when it get into the hands of Canada post? Does it go into a bin marked "ultra-low priority" because it does not have a Canadian tracking number on it?
Basically, Yes.
There's an international reciprocity agreement between postal services. Basically, each country agrees to deliver mail originating from other countries for a nominal fee, which was set years ago and doesn't actually cover the cost of delivery over here. That was OK when people were primarily sending letters back and forth -- traffic was approximately equal in both directions and Canada Post could bury the shortfall in the profits from outgoing mail.
That was before the internet. Now ****-chat goes by e-mail and twitter and facebook, et. al. Parcels are now a much higher percentage, there's just not that many parcels heading from here to China, and the overseas countries benefiting from subsidized delivery aren't interested in renegotiating the rates. So Canada Post has been paring down the service to the bare minimum. In August of 2015, they stopped offering on-line tracking for incoming registered mail (they still track it internally though -- you can call or visit and a clerk can look it up for you if the seller provided a tracking number) .
Once they killed the tracking, things really started to slow down. CP does try to blame Customs, but EMS parcels (which are still tracked) do tend to arrive promptly. EMS is the international postal union's courier service. You pay more, but if the seller is willing to ship via EMS then you will get your parcel in a reasonable time. I've had stuff from China in 2 days by EMS.