COVID-19 Could Alter Agricultural Trade Relationships
While progress was being made on the U.S.-China Phase One agricultural deal with changes to regulations on non-tariff barriers, COVID-19 has raised questions about diversifying suppliers for worldwide trade, reports The McDonough County Voice.
“We saw lower buying activity from China in January and February of 2020, just as China was starting to offer tariff waivers to facilitate import purchases from the U.S.” said Virginia Tech expert Jason Grant, associate professor of agricultural and applied economics at Virginia Tech.
“COVID-19, however, has likely impacted first quarter imports as agricultural trade numbers are running significantly behind 2017 Phase One benchmark levels, which means that China would have to purchase a lot of product later this year to fulfill the deal,” said Grant. “Backhauling is another supply chain issue, if ships are delayed in China and aren’t coming to U.S. ports, or vice versa, then there could be a shortage of ships, which is not good news for U.S. producers trying to sell product to China.”