Impact of COVID 19 on China’s agricultural trade

Nghiên cứu ảnh hưởng về đại dịch Covid 19 tới giao thương ngành nông sản của Trung Quốc. This study seeks to analyze how the outbreak of COVID19 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 longterm 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 SinoUS Economic and Trade Agreement (SUETA).

Impact of COVID-19 on China ’s

agricultural trade Lijuan Cao, Tianxiang Li and Rongbo Wang

College of Economics and Management, Nanjing Agricultural University, Nanjing,

China, andJing ZhuCollege of Economics and Management, Nanjing Agricultural University, Nanjing,

China andChina Center for Food Security Studies, Nanjing Agricultural University,

Nanjing, China

Abstract

Purpose – The 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/approach – This 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).

Findings – The 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/value – Agricultural 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.

Keywords COVID-19, Agricultural trade, Food security, Agricultural policy, China

Paper type Research paper

1 Introduction

The COVID-19 virus broke out in late 2019 and continues to spread across the globe

According to the data released by the World Health Organization (WHO), as of April 15th,

COVID-19 has spread to 211 countries and regions, 9 of which have more than 50 thousand

confirmed cases These countries include many of the world’s most important economies

The impact of COVID-19 on China ’s agri-trade

1

The authors acknowledge financial support from the National Science Foundation of China (Project No.

71773051, 71803085 and 71934005), National Social Science Fund of China (Project No 20ZDA102),

Support by PAPD of Jiangsu Higher Education Institutions, Jiangsu Center for Food Security Studies,

and Funds for the Central Universities (Project No SKCX2017002 and SKYZ2020004) is also

acknowledged The usual disclaimers apply.

The current issue and full text archive of this journal is available on Emerald Insight at:

https://www.emerald.com/insight/1756-137X.htm

Received 5 May 2020 Revised 30 May 2020

20 August 2020 Accepted 3 September 2020

China Agricultural Economic

Review Vol 13 No 1, 2021

pp 1-21

© Emerald Publishing Limited

1756-137X

(WHO, 2020) Unprecedented control measures, e.g city-wide lockdowns, social distancingmeasures, etc.— which negatively affect economic activities at large, also add significantuncertainty and adversity to agricultural trade.

Agricultural trade in China has developed at a fast pace since the country joined the WorldTrade Organization (WTO) Its total agricultural trade volume has increased from 28 billionUSD to 230 billion USD from 2001 to 2019 (UNcomtrade, 2020), standing presently as theworld’s No 1 importer and No 3 exporter Agricultural trade has played a prominent role inimproving resource allocation and farmers’ income through exporting agricultural products,

as well as contributing increasingly to enhanced food security by importing substantialamounts of food to satisfy the ever-growing demand from the world’s largest populations(Cheng, 2012;Cheng and Zhu, 2014;Ye, 2018;Zhu et al., 2018)

During the pandemic, there have been restrictive entry policies formulated by a number ofcountries to deny food imports from China, resulting in both short- and long-term impacts onChina’s agricultural exports There have also been cases where major food exporting countries haveimposed embargoes on major food crops, causing panic and volatility in the international foodmarket, as well as concerns regarding China’s future agricultural import and food security How thepandemic impacts China’s agricultural exports and imports and what are the short- and long-termprospects are important questions which require further, in-depth and timely research[1].Using observational data currently available, this paper is an initial attempt to explore thepotential impact of the pandemic on China’s agricultural trade With respect to exports, wehave pinpointed major disruptive factors arising from the pandemic which have affectedChina’s agricultural exports in both the short and long-term; in doing so, we employ scenarioanalysis which simulates potential long-term effects With respect to imports, the potentialimpact of the pandemic on the prospects of food availability in the world market isinvestigated Furthermore, we engage in an analysis of potential short- and long-termchanges in China’s food supply, especially with regard to meat imports, which have risen inlight of the pandemic and other external factors It must be noted that, due to the evolvingnature of the ongoing pandemic, quantitative and qualitative empirical analyses in this paperare limited to the extent that the current data allows

The analysis shows that, compared to drastic short-term disruption, the futureuncertainty of economic growth at large and the potential imposition of non-tariff tradebarriers (NTBs)—under the pretense of international safety concerns—would exert far moreprofound and lasting negativity on China’s agricultural export market On the other hand, thelonger-term prospects for world food supply and availability still suggest optimism,notwithstanding short-term supply chain disruption and international market volatilityresulting from irrational panic The resultant future downward trend of meat prices in theinternational market, in view of China’s newly signed trade agreement with the United States,tends to give rise to China’s import of pork products to a noticeable extent, signaling apotential shift in China’s agricultural trade toward more meat importation in the near future.Presently, the COVID-19 pandemic is ongoing and the full consequences have yet to bediscerned It is hoped that this paper will serve as an initial step in exploring the impact of thisunprecedented pandemic on China’s agricultural trade, contributing, in turn, to policymaking.The rest of the paper is organized as follows:Section 2is an examination of the potential impact ofthe COVID-19 outbreak on China’s agricultural exports;Section 3is an exploration of the prospects ofChina’s agricultural imports in view of the pandemic’s various impacts;Section 4concludes

2 COVID-19 outbreak and potential impact on China’s agricultural exportsThe outbreak of COVID-19 not only led to the disruption of global agricultural trade chainsbut also resulted in restrictions from trading partners which will certainly affect the short-term performance of China’s agricultural exports Moreover, the slowdown of global

CAER

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2

economic growth and the possible increase of NTB measures due to increasing health

concerns in various countries are anticipated to have a profound and long-term impact on

China’s agricultural exports This section intends to thoroughly examine potential factors

which may impact China’s agricultural exports in both the short and long term Additionally,

it provides a scenario analysis which simulates possible long-term impacts of the COVID-19

pandemic on China’s agricultural export market

2.1 The outbreak and short-term disruptions

After the COVID-19 outbreak, China’s agricultural exports plunged dramatically According

to the data from the General Administration of Customs, China’s exports decreased by 11.6%

year-on-year in January and February

The chief reasons for this drastic decline of China’s short-term exporting may be examined

in two ways: the first being the abrupt disruption of supply chains of agricultural exports; the

second being trade restrictions imposed on a series of Chinese agricultural products by a

significant number of importing countries

Immediately following the outbreak of the pandemic, the agricultural export supply chain

began to experience various short-term problems Many firms producing export commodities

remained shut down as employees could not return to work; some export companies reported

a loss to more than 30% due to a lack of employees showing up to work (The 21st Century

Business Herald, 2020) Additionally, transportation control increases shipping fees A

survey on agricultural export firms shows that 69.9% of the respondent firms experienced an

increase of logistical fees (Agricultural Trade Promotion Center, 2020a) Furthermore, the

operation efficiency of domestic ports has declined, resulting in reduced transportation

capacity

In the meantime, the operation of foreign ports is not as efficient as normal, with some

countries even closing their ports, substantially affecting the normal unloading and customs

clearance process For example, as the outbreak worsened, the Queensland Maritime Safety

Authority (MSQ)—where the port of Brisbane, Australia is located—banned all foreign

merchant ships from docking ports in all Queensland regions for a period of 14 days It is

reported that, in view of the measures to seal cities, the European internal land transport

logistics enterprises took a major hit: e.g the highway connecting Germany and Poland has

been congested, which also has affected the export of China’s agricultural products to those

destination countries (Sohu News, 2020a)

In addition to the supply disruption, some countries have used the pandemic as an excuse

to take measures which restrict the import of China’s agricultural products, resulting in trade

barriers to Chinese exports (Agricultural Trade Promotion Center, 2020b) Although there are

some countries that have introduced such restrictive measures, such as Tajikistan, Jordan,

Mongolia, South Korea, Kyrgyzstan, Egypt, etc., most of them are in fact not the main target

markets of China’s agricultural export (seeTable 1) It is illustrated inFigure 1, where the

2015–2017 average of China’s agricultural exports to these destination countries are compiled

and presented The total value amounts to 138 million USD, less than 1% of China’s total

agricultural exports, and the actual loss finally realized would be even less, due to the quick

drop out of restrictions, for example, Mauritius canceled import restrictions on Chinese

agricultural products other than live animals and fish in early February

2.2 Potential adversities with lasting effects

The abrupt disruption of supply chains has gradually recovered with the improvement of the

COVID-19 situation both within and outside of China The bleak economic prospects that

have suppressed consumption and demand, along with the possible escalation of trade

The impact of COVID-19 on China ’s agri-trade

3

01-2015 02-2015 03-2015 04-2015 05-2015 0-2015 07-2015 08-2015 09-2015 10-2015 11-2015 12-2015 01-2016 02-2016 03-2016 04-2016 05-2016 0-2016 07-2016 08-2016 09-2016 10-2016 11-2016 12-2016 02-2017 03-2017 04-2017 05-2017 0-2017 07-2017 08-2017 09-2017 10-2017 11-2017 12-2017

1.0% 100

Million $ 80

60 40 20 0

0.8% 0.6% 0.4% 0.2% 0.0%

Note(s): 1 Tajikistan and Jordan imposed restrictions to all agricultural imports from China.

Other countries in this figure imposed restriction to only animal products 2 Share refers tomonthly amount involved in the export restrictions / China’s monthly export of agriculturalproducts

Source(s): Authors’ calculations based on data from UNcomtrade

Country Measurements Rep of Korea Import of wild animals that may transmit coronavirus from China was prohibited, mainly

including snakes, bats, civets, etc Mongolia Restricted the import of chicken and egg products and strengthened the quarantine and

supervision of imported goods from China Indonesia Import of live animals from China was prohibited India Strengthened the quarantine of agricultural products and animal husbandry products from

China Pakistan Strengthened fumigation and disinfection measures for animal products from China in

Karachi Port Nepal Suspended the import of animal products Kyrgyzstan Import of live animals, birds, fish, honey and animal products from China was restricted

temporarily; Import restrictions of meat products had been canceled Kazakhstan Import of Chinese aquatic products was suspended

Tajikistan Import of Chinese food was prohibited Jordan Import of Chinese animal and plant products and the issuance of relevant licenses were

suspended Turkey Import of various animal products from China was suspended Azerbaijan Import of live animals, animal products, seafood and wildlife from China was suspended Georgia Suspended animals import from China

Egypt Forbade to import onions from China and strengthened the import inspection of 14 kinds of

agricultural products, such as potatoes, oranges and peanuts Cameroon Suspended the import of animals and aquatic products from China and strengthened the

quarantine measures of animals at sea, land and air ports Mauritius Import of live animals, live fish and animal products from China was suspended On February

6, the restrictions were narrowed down to live animals and fish Russia Import of insects, arthropods, amphibians, reptiles, live fish and aquatic organisms from China

was suspended temporarily Source(s): Compiled by the authors from Agricultural Trade Promotion Center (2020b)

barriers imposed by an increasing number of importing countries, are both factors which

may have profound, long-term impacts that deserve our undivided attention

2.2.1 Dampened external demand In addition to triggering short-term supply chain and

logistical disruptions, the global economic recession caused by the pandemic and the

resulting decline in demand for agricultural imports could affect China’s agricultural exports

over a longer period of time (Zhang et al., 2020;Barichello, 2020) The OECD report in March

forecasted that the global economy would grow by 2.4% at best in 2020 (OECD, 2020) Lately,

according toGoldman Sachs (2020), the COVID-19 pandemic in Europe, the United States and

China is projected to reduce global GDP growth to 1.25% in 2020 More recently, the IMF’s

newly issued World Economic Outlook Report predicts that global GDP will decrease by 3%

in 2020, the worst recession since the Great Depression and significantly worse than the

global financial crisis of 2008 (IMF, 2020a) In short, the outbreak casts a shadow over the

global economy and therefore, the external demand for Chinese agricultural exports as a

consequence

It is also worth to note that since the income elasticities and market orientations of various

export products differ, the decline in foreign demand for agricultural products vary among

different products accordingly For example, the existing literature shows the elasticity of

China’s aquatic exports to foreign income, which amounts to 1.17 in works byHu and Huo

(2008), is relatively higher than those of vegetable exports, 0.7629–0.7829 and
0.49%, as

measured byZhang et al (2013)andZhang and Mu (2015) Relatively high elasticity may lead

to a more pronounced decline in exports of aquatic products than would be seen among less

elastic products, such as fruits and vegetables, the most two important products for China’s

agricultural exports On the other hand, UN Comtrade data shows that aquatic products,

China’s largest agricultural export, are mainly exported to Japan, the European Union, South

Korea and the United States, where the GDP growth rates are projected by the IMF’s forecast

to fall to
5.2%,
7.5%,
1.2% and
5.9%, respectively, by 2020 This drop in growth is

bound to significantly reduce the export of such products Unlike aquatic products, the target

market for vegetables —China’s second largest agricultural export—is concentrated in

Vietnam, Hong Kong, Japan and Malaysia, where the GDP growth rate, according to the IMF

forecast, will change by 2.7%,
4.8%,
5.2% and
1.7%, respectively, in 2020 It could be

expected that with emerging economies, relatively less heavily affected by the pandemic in

economic growth, becoming increasingly the major targets of Chinese agricultural export

amid the global economic downturn, there may appear broader changes in the fundamental

structure of China’s agricultural export market

2.2.2 Possibility of future NTB It has been observed that after the COVID-19 pandemic in

China was declared by the WHO as a public health emergency of international concern

(PHEIC), some 17 countries took measures to restrict the import of Chinese agricultural

products, especially live animals and animal products (Agricultural Trade Promotion Center,

2020b) This gives rise to concerns over the possibility of increasing NTB measures for China

in the near future, including sanitary and phytosanitary (SPS) measures, technical barriers to

trade (TBT) and other NTB measures

We hereby provide an analysis of comparison of the changes in NTB suffered by China

before and after the outbreak of SARS in 2003, the most comparable and available case to that

of the present pandemic, to shed some lights on the prospected change in this regard

Considering that SPS are the most frequently used means of NTB measures toward

agricultural export and that special trade concerns (STC) can better reflect the severity of SPS

measures (Crivelli and Gr€oschl, 2016;Tian and Cai, 2019), we focus on a comparison of the

changes of SPS-STCs volume encountered by China’s agricultural export market around

2003 As indicated byTable 2, our analysis of the WTO’s Integrated Trade Intelligence Portal

(I-TIP) shows that, compared to the period from 1998 to 2002, China’s agricultural exports

from 2003 to 2007 were subject to more than twice in the number of SPS-STCs In terms of

The impact of COVID-19 on China ’s agri-trade

5

launch frequency, prior to 2003, the United States, Japan and Australia each raised one STC Afterward, the United States, the European Union and Japan each launched three to fiveSPS-STCs A growing number of Chinese products with long-standing export advantageswere more frequently subject to SPS measures, including fresh apples and pears, tea, spices,fish, beef, chicken, etc.

SPS-Increased NTB will directly lead to the rejection and confiscation of some of China’scompetitive export products which will result in huge economic losses This will also lead torising compliance costs to Chinese exporters, since they will have to either evade or meethigher requirements, thereby indirectly affecting China’s agricultural exports Althoughprevious studies did not directly list the SARS epidemic as the reason for the increase of NTB

to China, it cannot be ruled out that they were imposed as a result of countries’ increasedconcern for public health post-SARS One good example to consider for reference is the case ofJapan’s nuclear leak, which shows that even after five years, only a few countries completelyloosened regulations, with many other countries, including China, still ban the import ofagricultural products originated from Fukushima and its neighboring regions (Sohu News,2020b) This, to certain extent, implies that there’s high probability the pandemic would lead

to increasing non-tariff measures, posing limits to agricultural exports (Barichello, 2020)

2.3 Simulation of prospective long-term impact

To gain further insights into the long-term impact of the decreased demand and NTBmeasures caused by the pandemic on China’s agricultural exports, we carried out asimulation analysis with scenarios associated with varying degree of changes in the abovementioned possible long lasting adversities

We set three scenarios to estimate the possible impact of the expected decline in economicgrowth on China’s agricultural exports: Scenario 1 (S1) is with projection of global economicgrowth rate at 2.4% as predicted by the OECD in March 2020, Scenario 2 (S2) at 1.25% by theGoldman Sachs Group in February 2020 and Scenario 3 (S3) at
3.0% by IMF in April 2020,

as opposed to Scenario 0, the benchmark scenario (S0), where the global economy is assumed

to grow at the rate of year 2019

The simulation results, as presented inTable 3, show that compared with the benchmarkscenario, the slowdown of global economic growth rate will lead to a noticeable decline

(1) Developed Countries

3 HS: 21, 08, 06,0602, 030613

(1) Developed Countries

11 HS: 21, 2106, 0808, 09,0902,160232, 0302, 0511,

Source(s): Authors ’ calculation based on data from WTO, Integrated Trade Intelligence Portal (I-TIP) (accessed 3 April, 2020)

China’s agricultural exports, namely by 0.38%, 1.26% and 4.52% in S1, S2 and S3,

respectively

We estimate further the impact of the pandemic by incorporating the possible increase in

SPS measures on China’s agricultural export in the aftermath of the pandemic, by taking into

account both direct and indirect effects on the enterprises’ compliance costs Previous studies

have shown that the compliance costs of agricultural export enterprises, when encountering

SPS measures, generally accounts for 5–15% of their sales revenue (Otsuki et al., 2001;

Jyasuriya et al., 2006) We therefore, set the following simulation scenarios, where S1*

assumes the number of SPS measures increases by 10%, the annual growth rate of SPS

initiated by China’s major export counterparts in 2010–18, while the compliance costs

increased by 5%; and S2* the number of SPS measures doubles for agricultural products,

with the compliance costs increased by 15%; as opposed to the S0*, the benchmark scenario,

where the number of SPS measures remains unchanged comparing to that of 2019

The results show that, compared with the benchmark, if the pandemic results in an

increase of SPS by 10–100% and the compliance costs of enterprises increases by 5–15%,

agricultural exports in China will be reduced by 1.68%–14.70% lower than the benchmark

scenario (seeTable 3)

We have also made an attempt to estimate the impact of the pandemic on different

categories of China’s agricultural export, taking vegetables and aquatic products, two major

agricultural exports in China as exemplars It is worth noting that since different categories of

agricultural exports have their own major targeted markets, with varying income elasticities,

the impact of the same pandemic on the export of these categories of products therefore

differs To simplify the illustration, we take the Scenario S1**, where the global economic

growth rate is as predicted by the IMF, as opposed to S0**, where the growth rate is assumed

to be unchanged from that of 2019

The simulation results, as presented inTable 4, show that in the situation as indicated by

S1**, export of China’s vegetables and aquatic products will drop by 0.22 and 0.64 billion

USD, respectively, manifesting a much larger negative impact of the pandemic on aquatic

products than that of vegetables A further decomposing of export market reveals that

China’s aquatic product exports to the European Union and the United States, the two major

markets, will fall by nearly 9% and 6%, respectively China’s vegetable exports, on the other

hand, sees an expected rise of 0.04 billion USD to its major export market of Vietnam and

Scenario

Growth rate of GDP

GR of agri export (%)

Forecast of agri.

export

Changes in value

Change rates (%) Simulations of change in global GDP

Forecast of agri.

export

Changes in value

Change rates (%) Simulations of change in SPS measures

Note(s): GR refer to growth rate

Source(s): Authors ’ calculation

Table 3 Scenario simulations of the impacts of changes

in global GDP and SPS measures on China ’s agricultural exports (billion USD)

The impact of COVID-19 on China ’s agri-trade

7

relatively small changes to other markets The contrast could be attributed to both thedifference in elasticity of these two categories of products and the difference in GDP growth inthose target markets, where developing countries are less negatively affected by thepandemic than those of developed countries.

3 Prospects for China’s agricultural imports with COVID-19 impact

As the world’s most populous country and the largest agricultural importer, China’s foodimports play an important role in meeting its growing domestic food demand and bolsteringfood security However, the COVID-19 pandemic, along with other domestic and internationaldynamics, has added an element of uncertainty to China’s food imports On the one hand, thefirst few months of the pandemic witnessed panic buying and embargoing by majorimporting and exporting countries High volatility in the world food market brought aboutgreat concern over the long-term food availability in the world market and China’s foodimport security On the other hand, the latest statistics show that China’s import of pork andbeef products surged by 170% and 65%, respectively, in the first quarter of 2020 It alsoremains to be explored whether this is the outcome of immediate changes in meat demand due

to COVID-19, or rather an indication of possible shifts in trade patterns in the long run

3.1 Food availability in the world market: short-term disturbance vs long-term supplyCOVID-19 related quarantine measures have resulted in significant challenges to the world’sagricultural supply and circulation systems During the outbreak, some countries introducedfood export restrictions for the sake of food security To date, 13 countries, including Russia,Cambodia, Vietnam and Egypt, have announced or initiated export restrictions on foodproducts, covering many categories of food (seeTable 5)

China ’s export to Export in 2019 Growth rate ofGDP (%)

Forecast of export

People around the world have also been hoarding food due to COVID-19 panic (seeTable 5).

This has resulted in a sharp rise in the demand for food reserves and imports in the short

term In this context, the short-term food supply and demand in the world market shows a

clear upward trend which can be seen in the price of rice For example, the price of white rice

from Thailand (5% broken) rose 9.7% from February to March (see Figure 2) This has

aroused widespread worldwide concern about food security (Glauber et al., 2020;Fan, 2020;

Fan et al., 2020;Ye et al., 2020;Si et al., 2020) Three international organizations, (i.e WTO,

Food export restrictions

Country/Group Products concerned Policies related

Vietnam Rice From March 24, all rice export has been suspended.

On March 31, the Vietnamese government announced

to resume rice export on the premise of ensuring food supply security

Cambodia Rice From April 15, it has been forbidden to export white

rice and paddy rice, but not Jasmine Rice (announced

on March 30) Kazakhstan Buckwheat, sugar, potato,

radish, wheat and flour etc.

From March 22, the export of agricultural products such as buckwheat, sugar, potato, radish, beet, onion, cabbage, sunflower seed, wheat and flour, etc., has been suspended And the monthly quota management system for wheat and flour has been implemented

Serbia Sunflower oil Sunflower oil export has been forbidden

Sudan Sorghum Ban on Sorghum export since April 15

Jordan Vegetables From March 28, stop exporting vegetables

Egypt Beans From March 28, the export of all kinds of beans has

been stopped Russia Wheat, barley and corn From April 1 to June 30, export quotas have been set

before the end of June North Macedonia Wheat Export of wheat, mixed wheat and wheat flour has

been temporarily prohibited The Eurasian

Panic buying

Algeria Wheat A new wheat tender was issued, ordering 680000 tons

of flour wheat at a high price on March 12 and another

240000 tons at a higher price on March 24

Morocco Wheat Wheat import tariff was suspended before the middle

of June Iraq Wheat and Rice Need for 1 million tons of wheat and 0.25 million ton of

rice was announced Note(s):aMembers in the Eurasian Economic Union are: Russia, Kazakhstan, Kyrgyzstan, Armenia and

Belarus

Source(s): Compiled by the authors from “Lists of restrictive measures due to COVID-19 in countries

(regions) ” in Business data center and public news from https://finance.sina.com.cn/wm/2020-04-18/

doc-iircuyvh8559486 shtml

Table 5 Export restriction on and panic buying of food in major trading countries during the COVID-19 pandemic (As of April 8, 2020)

The impact of COVID-19 on China ’s agri-trade

9

FAO and WHO) jointly issued a statement stating that“As countries move to enact measuresaiming to halt the accelerating COVID-19 pandemic, care must be taken to minimize potentialimpacts on the food supply or unintended consequences on global trade and food security.”(Xinhua Net, 2020).

Such a situation reminds people of the world food crisis taking place during 2007–2008,when there occurred a shortage in the world food supply, resulted from droughts in bothAustralia and Argentina and concurrent excessive biomass fuel development As a result, themajor international food import and export countries bought food en masse and limitedexports, shocking the world food supply For example, Morocco and the European Unionreduced import tariffs on wheat and grain, respectively, while countries such as Kampuchea,Vietnam and India restricted rice exports This ultimately led to a 1.76-fold increase in theprice of rice during the six months following October 2007, which in turn triggered a globalfood crisis However, just after half a year, food prices worldwide (except for rice) began to fallsharply, dropping to a level even lower than they were before the crisis (seeFigure 2)

In contrast, the world food prices in the recent year have been remaining at relatively lowlevels Although there occurred some small upward move in February 2020, prices for foodother than rice have already shown signs of declining in March, as manifested inFigure 2

As such, this short-term fluctuation in the world food market is more attributable to thebeggar-thy-neighbor trade policies adopted by some major food trading countries, than to thereal change in supply and demand resultant from COVID-19

To understand the long-term impact of COVID-19 on China’s food import security, it is thelonger term food production capability, than the short-term disturbance, that deserves ourfocused attention Therefore, it is necessary to explore if the pandemic will exert a negativeimpact on the long-term supply capacity of food production We focus on two kinds ofproducts which are important to China’s food and import security: grain, the traditionally

Note(s): World’s maize price is the f.o.b US Gulf ports price of yellow maize (no 2); sorghum

price refers to f.o.b US Gulf ports price of yellow sorghum (no 2); world’s rice price refers to f.o.b.Bangkok price of white rice (5% broken); international wheat price refers to export price of US hardred winter wheat (no.1) delivered at the US Gulf ports

Source(s): Prepared by the authors with data from Pink Sheets, World Bank, extracted on 2020-4-20

0 100 200 300 400 500 600 700 800 900 1,000

Changes in world grain

prices (Jan 2007 –Dec.