Impact of COVID-19 on China's agricultural trade

Abstract

PurposeThe outbreak of the novel COVID-19 virus has spread throughout the world, causing unprecedented disruption to not only China's agricultural trade but also the world's agricultural trade at large. This paper attempts to provide a preliminary analysis of the impact of the COVID-19 pandemic on China's agricultural importing and exporting from both short- and long-term perspectives.Design/methodology/approachThis study seeks to analyze how the outbreak of COVID-19 could potentially impact China's agricultural trade. With respect to exports, the authors have pinpointed major disruptive factors arising from the pandemic which have affected China's agricultural exports in both the short and long term; in doing so, we employ scenario analysis which simulates potential long-term effects. With regard to imports, possible impacts of the pandemic regarding the prospects of food availability in the world market are investigated. Using scenario analysis, the authors estimate the potential change in China's food market—especially meat import growth—in light of the implementation of the newly signed Sino-US Economic and Trade Agreement (SUETA).FindingsThe results show that China's agricultural exports have been negatively impacted in the short-term, mostly due to the disruption of the supply chain. In the long term, dampened external demand and potential imposition of non-tariff trade barriers (NTBs) will exert more profound and lasting negative effects on China's agricultural export trade. On the other hand, despite panic buying and embargoing policies from some exporting and importing countries, the world food availability and China's food import demand are still optimistic. The simulation results indicate that China's import of pork products, in light of COVID-19 and the implementation of SUETA, would most likely see a sizable climb in quantity, but a lesser climb in terms of value.Originality/valueAgricultural trade in China has been a focal-point of attention in recent years, with new challenges slowing exports and increasing dependence on imports for food security. The outbreak of the COVID-19 pandemic adds significant uncertainty to agricultural trade, giving rise to serious concerns regarding its potential impact. By exploring the impact of the unprecedented pandemic on China's agricultural trade, this study should contribute to a better understanding of the still-evolving pandemic and shed light on pertinent policy implications.

Dynamics of Malaysia’s Bilateral Export Post Covid-19: A Gravity Model Analysis

“…A similar finding is obtained by Cao et al (2020), where the agricultural exports for China have been negatively impacted in the short-term due to the disruption of the supply chain. Furthermore, some studies expect that the high probability of the pandemic would lead to increasing non-tariff measures, posing limits to agricultural exports (Barichello, 2020;Cao et al 2020). Besides focusing on trade volume, Qin et al (2020) and Akter (2020) analyse the impact of Covid-19 on the volatility of commodity prices and food prices, respectively, and find that the current pandemic is expected to increase prices.…”

“…The same is expected for the agricultural exports for China in the long-term due decline in demand for agricultural imports (Zhang et al, 2020;Barichello, 2020). A similar finding is obtained by Cao et al (2020), where the agricultural exports for China have been negatively impacted in the short-term due to the disruption of the supply chain. Furthermore, some studies expect that the high probability of the pandemic would lead to increasing non-tariff measures, posing limits to agricultural exports (Barichello, 2020;Cao et al 2020).…”

“…However, in terms of export, the World Trade Organization (2020) results indicate that exports from North America and Asia will hit the hardest. The varying impact has motivated several studies to analyse countryspecific impacts, such as for Canada (McEwan et al 2020;Barichello 2020), United States (Walmsley et al 2020), China (Cao et al 2020), and Africa (Ataguba 2020).…”

“…However, most literature focussed more on the financial impact (see Vidya & Prabheesh 2020). Several researchers had investigated the trade impact, but their analysis is either at the country level, aggregated sectors or focussed on specific sectors (Cao et al 2020;McEwan et al 2020;Vidya & Prabheesh 2020). Thus, their studies may subject to aggregation bias and unable to explain the varying sectoral impact.…”

Has the COVID-19 Pandemic Affected Maritime Connectivity? An Estimation for China and the Polar Silk Road Countries

“…Many studies have demonstrated emerging threats to global food security [62,143] and tremendous disruptions in agricultural supply chains [144,145] due to the pandemic. Notwithstanding that Wang et al [146] and Cao et al [147] expect that the impacts of supply disruption would be short-lived, development of warehousing and storage capacities at ports along the PSR should be considered a fundamental issue to ensure the sufficiency of safety stocks and inventories. The improvement of port infrastructure connectivity, logistics performance [68], and diversification in maritime routes [1] will allow China and its counterparts to avoid localized disruptions, establish a multiple-location trade network in the High North, and enhance the resilience of supply chains globally.…”