The impacts of large-scale OFI on grains import: Empirical research with double difference method

In recent years, overseas farmland investment has grown rapidly and attracted international attention. With more and more countries joining the OFI Club, global OFI has provided a considerable amount of grains, increasing the grains supply of the markets. The growth of grains supply will help investor countries, especially countries with food security, increase their grains import theoretically. However, there are few kinds of literature concerning the impacts of OFI on grains import of investor countries for the inaccessibility of data. In this paper, we adopt the double difference method to estimate the net effects of large-scale OFI on wheat, maize, soya beans, and rice among fifteen investor countries and seven non-investor countries. First, we find that large-scale OFI after 2005 increases the imports of 2.8% for maize, 2.5% for soya beans and 7.3% for rice. Second, the net effects of large-scale OFI on grains imports have changed at different stages. Even though the net effects were increasing since 2005, the differences in net effects of stages 2005–2011, 2012–2014, and 2015–2016, are becoming smaller. Third, compared with wheat, maize and soya beans, rice has higher impact coefficients. That means OFI is easier to affect rice import for investor countries. The research confirmed that OFI is an important approach to ease the grains crisis. Countries wishing to import more grains to meet domestic demand should pay more attention to rice investment.