Future growth in food and feed trade is facing headwinds from political, economic, policy and disease fronts. Countries, including the U.S., who once pushed for more open and free trade are either standing on the sidelines or engaging in talks around labor, climate and gender equality. Few appear to be engaged in traditional negotiations over tariffs, quotas, market access nor WTO reform.
Two of the largest economies and agricultural consumers in the world, China and the U.S., are in a political and policy cold war which has altered the world economic infrastructure. Both are pursuing what appears to be a long and bitter political, economic and policy cold war. Few expect Secretary of State Blinken’s current talks with senior officials in Beijing to advance the relationship and reduce tensions.
China, the largest world importer of food and feed continues to look to non-U.S. suppliers while the U.S. is doing the same regarding China in terms of manufactured and tech goods. While China ag imports continue to grow, the U.S. market share continues to hover around 17%, about the same as in 2017. In short, the U.S. is limited in its ability to take full advantage of the largest and fastest growing ag customer in the world.
Outside of the U.S. and Brazil, the major food and feed producers and exporters in the world, including China, are facing stagnant or declining economic growth. Underpinning all this uncertainty are animal disease outbreaks and trade policy. Avian Influenza continues to kill chickens and has spread to some mammals as well. While vaccines are currently available their use is limited given potential market closures as the vaccine may mask the spread of the virus. ASF continues to be a threat, as does BSE, lumpy skin disease and FMD.