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  5. The COVID-19 Pandemic: Insights from Agricultural Economists
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The COVID-19 Pandemic: Insights from Agricultural Economists

Paper Session

Sunday, Jan. 3, 2021 12:15 PM - 2:15 PM (EST)

Hosted By: Agricultural and Applied Economics Association
  • Chair: Craig Gundersen, University of Illinois

Beef and Pork Gross Marketing Margins during COVID19

Jayson Lusk
,
Purdue University
Glynn Tonsor
,
Kansas State University
Lee Schulz
,
Iowa State University

Abstract

The controversy surrounding the price movements following a packing plant fire in Kansas was but mere prelude to that surrounding the unprecedented COVID-related disruptions and historic rises in beef and pork gross marketing margins, defined as the difference between wholesale meat and farm-level livestock prices. Concerns about concentration and allegations of anticompetitive behavior have led to several civil suits and inquiries by the U.S. Department of Agriculture and the U.S. Department of Justice, with increases in the gross margins serving as a focal point. This article outlines the economic theory behind the determination of gross marketing margins and then describes the empirical evidence on wholesale meat and livestock price dynamics in the wake of COVID-19 disruptions. At one point during the pandemic, beef and pork packers were both running about 40% below national processing capacity. We explore how such a massive supply shock would be expected to affect gross marketing margins even in absence of anti-competitive behavior. Finally, we conclude with some discussion on impacts of policy proposals that would possibly pit industry concentration against industry coordination and economies of scale.

Food Loss and Waste in the United States during COVID-19

Norbert Wilson
,
Duke University
Brenna Ellison
,
University of Illinois
Brandon McFadden
,
University of Delaware
Bradley Rickard
,
Cornell University

Abstract

The physical and emotional stress of COVID-19 is devastating. However, the pandemic and the efforts to manage the disease have ravaged the economy. The food system has been a victim of this damage. At the household level, COVID-19 has altered our food patterns (food acquisition, cooking, and consumption) and, by extension, waste. Ellison et al. (2020) discuss how COVID-19 and the related economic fallout could affect consumers through changes in the way households stockpile and manage food. Negative income shocks and rising food prices may impact food waste. Between March and April 2020, we collected four waves of a survey to assess food waste and food acquisition behavior during COVID-19. With longitudinal data from over 1,350 individuals, we test the differential response of U.S. consumers to COVID-19 on waste and stockpiling behavior. We find initial evidence that food waste and concomitantly stockpiling may have increased during the pandemic.

How is Sub-Saharan Africa Confronting the Tradeoffs in COVID-19 Mitigation Policies?

Valerie Mueller
,
Arizona State University

Abstract

Developing economies will be confronted with pandemics given current trends in globalization and changes in the environment. In this paper, we would conceptualize how to evaluate the economic tradeoffs between short- and long-term productivity losses inherent in alternative approaches for mitigating transmission of COVID-19. This framework is used to examine which policies are optimal for reducing economic losses given different demographic and labor market characteristics of the economy. We then demonstrate how closely current mitigation practices reflect what might be optimal for select countries in Africa.

Seasonal Farm Labor and Risk of Covid-19 Spread

Diane Charlton
,
Montana State University

Abstract

Worker safety during the coronavirus pandemic is of primary concern, particularly in essential industries where working remotely is not possible. Despite employer precautions, there have been numerous worksite outbreaks of COVID-19. This paper examines the relationship between month-to-month changes in expected agricultural employment within counties and new COVID-19 cases. The results show a positive association between agricultural employment and new COVID-19 cases with employment in fruit production having the strongest relationship. I find that employment of 100 additional workers in fruit, vegetable, and horticultural (FVH) production within a county is associated with 21 new COVID-19 cases.
JEL Classifications
  • A1 - General Economics