The COVID-19 pandemic has caused massive disruptions of food supply chains in the United States, although so far they are mainly temporary and not worthy of restrictions in American exports to China or other countries, two experts told journalists.
The U.S. needs trade both to import foods that are in short supply due to the pandemic and to export products that farmers need to sell to stay afloat, according to Ambassador Darci Vetter (bio, Twitter), a former agricultural trade negotiator. Some of the types of foods being exported – such as pig organs – are not the same foods that Americans want to eat, but they are vital to the farm economy, she noted.
The empty supermarket shelves are mostly about pandemic disruptions to the supply chains – not shortages in supplies themselves, explained Shefali Kapadia (bio, Twitter), senior editor at Supply Chain Dive at IndustryDive.com.
The experts spoke during an online briefing for the National Press Foundation soon after the U.S. Department of Labor released statistics showing that food prices rose 2.6% in April 2020 even as overall U.S. consumer prices dropped by 0.8%, the most since the Great Recession.
While shortages or price spikes in any food tend to trigger outbreaks of economic nationalism and restrictions on food exports, data from the 2007-2009 recession show that such restrictions exacerbate the problem, said Simon Evenett, founder of Global Trade Alert and a professor of international trade and economic development at the University of St. Gallen in Switzerland (bio, Twitter).
“Globalization is actually a really important part of the solution, and it can be leveraged – that is, tapping overseas markets to mitigate U.S. domestic supply disruption,” Evenett said. “The fact that we can source from abroad is a major positive.”
According to Evenett, 40 countries heavily imported beef to the U.S before the pandemic. It’s the same case for pork and chicken, with 35 countries importing each to the U.S. Since coronavirus doesn’t hit every country at the same time, opening food trade with other nations will allow those that have gone through early stages of coronavirus to make their markets accessible to others that are still struggling, he said.
But the disconnect between too much supply and the disruptions upstream in the supply chain is causing logistical bottlenecks, such as in transportation, packaging and labor, the experts said.
For example, truck drivers who cannot find facilities or hotel rooms may choose not to take long drives. A farm that normally ships 50-pound bags of potatoes to restaurants may not be able to quickly shift to selling 5-pound bags to consumers – or deem it worthwhile to revamp production if the disruption is to be short-lived.
Beyond that, agricultural laborers may not have been able to get visas if U.S. consulates were closed, and both agricultural and food processing workers may choose not to work if they cannot do so safely, they said.
As for the recent U.S.-China trade deal, Vetter said that Phase I purchase levels are unrealistic considering China’s demand and what its economy needs. Growing tensions between the U.S. and China are not making the purchases easier to attain, either.
“I think you’ve seen a growing narrative coming out of the United States blaming China, whether it’s for the virus itself or for these trade tensions,” Vetter said. “It may be a theme up until election day.”
Journalists need to keep focused on how COVID-19 progresses and whether the current disruptions will continue. “One thing I would be tracking is how quickly do these supply chains – which are being disrupted – reconfigure and start working again?” Evenett asked.
“The private sector replies really fast to this,” he added. “So it may appear to be a drama now – but will it be a drama one or two months from now? We will see.”
Kapadia also suggested that reporters explore how food production itself will change.
“What effect does automation have on workers’ health?” she asked. “Can you spread people farther apart and have an autonomous robot moving things back and forth? It will be interesting to see long term how those investments play out from a safety perspective, as well as a proficiency perspective.”