Canadian Journal of Agricultural Economics-Revue Canadienne D Agroeconomie最新文献

The dairy and poultry sectors responded quickly to the initial adjustments in the quantity and nature of food products forced by the shuttering of the hospitality sector and the subsequent switch to buying food from grocery stores. In addition, these sectors were less affected by the labor availability and health issues from COVID-19 (coronavirus disease-2019) that plagued others, such as red meat processors. While the overall impacts were less than most other parts of the agri-food system, some elements of supply managed products, particularly poultry processors, have experienced a reduction in returns and are still adjusting to the new demand and supply situation. The extent of the impact is correlated with the degree to which the supply chain further upstream was connected to the downstream hospitality sector.

The unexpected introduction and spread of coronavirus disease-2019 (COVID-19) has presented significant risks for every aspect of Canadian society, including the food and agricultural sector. The suite of Business Risk Management (BRM) programs, developed decades ago and without any thought to the possibility of a global pandemic, are meant to assist farmers in managing risks. This article discusses to what extent these BRM programs, and more broadly government programs, assisted farmers in managing risks brought on by the pandemic. Despite calls by industry for significant additional public funds, we find that COVID-19 exposed no significant gaps in BRM programming and therefore we see no reason for more funding to be funneled to the farm sector through BRM programming.

In this paper, I explore the economic activities of the food processing industry during the coronavirus disease-2019 (COVID-19) pandemic. One of the key lessons from food processing and related industries is that without being designated as an essential service and targeted stimulus packages, the food industry could have fallen victim to the COVID-19 crisis. Although the social and economic impacts of the interventions are not clear, being designated as an essential service was likely far more important to the food industry than the targeted stimulus packages. The pandemic and shutdown orders had a considerable production reallocation effect. Some processors have seen temporary closure and reduced capacity utilization. On the upside, disruptions in the food processing sector have not been as severe as in non-essential sectors. The food processing sector has proven to be relatively stable during the pandemic – food was still processed and delivered to consumers and food price increases were minimal in most cases given the scale of the shock. Moving forward, because COVID-19 is a global crisis, internationally targeted and coordinated efforts to tackle the virus could place the industry on a strong trajectory towards economic recovery and growth.

Résumé

Dans cet article, j'explore les activités économiques de l'industrie de la transformation des aliments pendant la pandémie COVID-19. L'une des principales leçons tirées de la transformation des aliments et des industries connexes est que sans être désignée comme un service essentiel et visée par des plans de relance ciblés, l'industrie alimentaire aurait pu être victime de la crise du COVID-19. Bien que les impacts sociaux et économiques des interventions ne soient pas clairs, être désigné comme un service essentiel était probablement beaucoup plus important pour l'industrie alimentaire que les plans de relance ciblés. La pandémie et les ordres d'arrêt ont eu un effet considérable de réallocation de la production. Certains transformateurs ont connu des fermetures temporaires et une utilisation réduite de leurs capacités. Les perturbations dans le secteur de la transformation des aliments n'ont pas été aussi graves que dans les secteurs non essentiels. Le secteur de la transformation des aliments s'est avéré relativement stable pendant la pandémie - les aliments étaient encoretransformés et livrés aux consommateurs et les augmentations des prix des denrées alimentaires ont été minimes dans la plupart des cas compte tenu de l'ampleur du choc. À l'avenir, parce que le COVID-19 est une crise mondiale, des efforts coordonnés et ciblés au niveau international pour lutter contre le virus pourraient placer l'industrie sur une trajectoire solide vers la reprise économique et la croissance.

Canada's unemployment rate increased rapidly in the spring of 2020 in response to strict public health measures. Low-wage workers were hit particularly hard, including restaurant workers. The production and distribution of food being essential and agri-food supply chains being resilient, other workers in the agri-food sector were less impacted by public health measures and the pandemic. Employment in grocery stores remained steady and employment of agricultural workers, including temporary foreign workers, proved more robust than expected. Dealing with contaminated workers proved challenging in meat processing plants. Temporary plant shutdowns and slowdowns created livestock queuing problems and temporary increases in meat prices. The federal and provincial governments implemented several programs to mitigate the pandemic's adverse effects on labor markets. The pandemic will have permanent effect on labor markets, but with unemployment rates falling rapidly across Canada, recruiting and retention remain the main labor issues in agriculture.

Brewin (2020) was optimistic about the fate of the Canadian grains and oilseeds sector in 2020 as the COVID-19 pandemic descended on the world. The sector did generate a large crop and, towards the end of 2020, saw a lift in prices. This contributed to record farm income in Canada in 2020. The pace of grain and oilseed exports in Canada and ethanol demand in the east were affected by COVID-19, but the forecast of a “near normal” 2020 was relatively accurate. Production and prices stayed on track, largely because the world did not impose significant new barriers to trade in cereals and oilseeds and because these sectors have distanced labor in virtually every step of the supply chain which protected these markets from this pandemic. The dominant price factor for the sector remains global demand that had been growing before 2020 relative to the pace of production and may have been stimulated by deficit budgets around the world. Compared to the tight global stocks, COVID-19 had a minor impact on grain prices which led to steady production worldwide and in Canada. We are still waiting for more evidence to assess the role of federal coordination in the success of the grains and oilseed sector in 2020, but Canada's past participation in trade and safety protocols based on science allowed the grains and oilseed sector in Canada to earn a very good income in 2020.

Early evidence suggests that Canadian farmland values increased in 2020. Farming returns were not negatively impacted by COVID-19 and it appears as though farming returns will be strong into 2021. Low interest rates in 2020 contributed to substantial farmland value increases in the last half of 2020. There is some evidence that the development component of farmland values increased in 2020. The future consequences of COVID-19 on farmland values are unclear. Some economists suggest that future inflationary risks have increased. A return to inflation rates comparable to those experienced in the 1970s is unlikely, but if increased inflation does materialize it will put upward pressure on farmland values, while increases in nominal and real interest rates will push farmland values down.

COVID-19 continues to impose a series of unique challenges on the food retail and food service sectors in Canada. In May 2020, the expectation was that the public health crisis shutdowns of the restaurant sector would be temporary. Although we may still be in a much longer temporary than was originally envisaged, it is becoming clearer that permanent restructuring may also have happened. Grocery stores have solidified their changed realities through an increased focus on multiple channel retailing rather than a complete choice between either bricks and mortar or online. Increased costs, resulting from the pandemic, are continuing to filter through the food system and we have a growing problem with food security for some Canadians given that employment in January 2021 was found to be at its lowest level since August 2020. Unemployment moves directly with lockdowns that are varied across the country.

A year into the COVID-19 pandemic, this paper reflects on the changes that occurred in agrifood supply chains in Canada and the United States. The sudden shift in food consumption patterns from food service to food retail required realignment of food supply chains. For the most part, food supply chains have performed remarkably well during the pandemic. Cross-border food supply chains have continued to function effectively. The most significant disruptions emerged from workforce outbreaks of COVID-19 in the meat processing sector and in fruit and vegetable production. The paper discusses supply chain resilience and argues that agrifood supply chains are characterized by several important differences that need to be taken into consideration when evaluating resilience. Economies of scale and scope offer economic efficiency advantages in normal times, while investments in adaptability and flexibility can enhance resilience for abnormal times. Potential long-run changes within supply chains include increased automation and digitalization in food supply chains, while investments in infrastructure for online delivery services have permanently altered the food retailing landscape.

This article briefly outlines the agrifood market and policy situation in the United States after 1 year of the COVID-19 pandemic. Agrifood markets suffered initial disruptions from both supply-side and demand-side shocks but significant adjustments by farmers, processors, distributors, and government kept these relatively shorty-lived. Substantial support has been provided to farmers as part of $5 trillion of economy-wide stimulus enacted. This included payments in 2020 under the Coronavirus Food Assistance Program (CFAP) of nearly $24 billion to producers of a wide array of products. These payments came on top of trade-related support provided to agriculture in 2018 and 2019. The stimulus also included expansion of nutrition assistance programs for low-income households which were among the hardest hit by the pandemic. I conjecture that the pandemic will influence planning and social policy across the US economy for years to come but will not shift the basic structure of US agricultural production and distribution. Counter-cyclical farm policy is reentrenched within the political arena and expectations for support levels may have been raised.