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COVID-19, supply chain disruption and China’s hog market: a dynamic analysis

Author

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  • Yubin Wang
  • Jingjing Wang
  • Xiaoyang Wang

Abstract

Purpose - The authors explicitly evaluate the dynamic impact of five most concerned supply chain disruption scenarios, including: (1) a short-term shortage and price jump of corn supply in hog farms; (2) a shortage of market hogs to packing facilities; (3) disruption in breeding stock adjustments; (4) disruption in pork import; and (5) a combination of scenario (1)–(4). Design/methodology/approach - The agricultural supply chain experienced tremendous disruptions from the COVID-19 pandemic. To evaluate the impact of disruptions, the authors employ a system dynamics model of hog market to simulate and project the impact of COVID-19 on China hog production and pork consumption. In the model the authors explicitly characterize the cyclical pattern of hog market. The hog cycle model is calibrated using market data from 2018–2019 to represent the market situation during an ongoing African swine fever. Findings - The authors find that the impacts of supply chain disruption are generally short-lived. Market hog transportation disruption has immediate impact on price and consumption. But the impact is smoothed out in six months. Delay in import shipment temporarily reduces consumption and raises hog price. A temporary increase of corn price or delay in breeding stock acquisition does not produce significant impact on national hog market as a whole, despite mass media coverage on certain severely affected regions. Originality/value - This is the first evaluation of short-term supply chain disruption on China hog market from COVID-19. The authors employ a system dynamics model of hog markets with an international trade component. The model allows for monthly time step analysis and projection of the COVID-19 impact over a five-year period. The results and discussion have far-reaching implications for agricultural markets around the world.

Suggested Citation

  • Yubin Wang & Jingjing Wang & Xiaoyang Wang, 2020. "COVID-19, supply chain disruption and China’s hog market: a dynamic analysis," China Agricultural Economic Review, Emerald Group Publishing Limited, vol. 12(3), pages 427-443, June.
    • Handle: RePEc:eme:caerpp:caer-04-2020-0053
    DOI: 10.1108/CAER-04-2020-0053
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    Citations

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    Cited by:

    1. Nornajihah Nadia Hasbullah & Zuraidah Sulaiman & Adaviah Mas’od & Hanis Syuhada Ahmad Sugiran, 2022. "Drivers of Sustainable Apparel Purchase Intention: An Empirical Study of Malaysian Millennial Consumers," Sustainability, MDPI, vol. 14(4), pages 1-24, February.
    2. Yicheol Han & Stephan J. Goetz & Claudia Schmidt, 2021. "Visualizing Spatial Economic Supply Chains to Enhance Sustainability and Resilience," Sustainability, MDPI, vol. 13(3), pages 1-15, February.
    3. Massimiliano Giacalone & Vito Santarcangelo & Vincenzo Donvito & Oriana Schiavone & Emilio Massa, 2021. "Big data for corporate social responsibility: blockchain use in Gioia del Colle DOP," Quality & Quantity: International Journal of Methodology, Springer, vol. 55(6), pages 1945-1971, December.
    4. Zainuddin, Muhamad Rias K V & Shukor, Md Shafiin & Zulkifli, Muhamad Solehuddin & Abdullah, Amirul Hamza, 2021. "Dynamics of Malaysia’s Bilateral Export Post Covid-19: A Gravity Model Analysis," Jurnal Ekonomi Malaysia, Faculty of Economics and Business, Universiti Kebangsaan Malaysia, vol. 55(1), pages 51-69.
    5. Gao Tianming & Vasilii Erokhin & Aleksandr Arskiy & Mikail Khudzhatov, 2021. "Has the COVID-19 Pandemic Affected Maritime Connectivity? An Estimation for China and the Polar Silk Road Countries," Sustainability, MDPI, vol. 13(6), pages 1-39, March.
    6. Queiroz, Maciel M. & Fosso Wamba, Samuel & Chiappetta Jabbour, Charbel Jose & Machado, Marcio C., 2022. "Supply chain resilience in the UK during the coronavirus pandemic: A resource orchestration perspective," International Journal of Production Economics, Elsevier, vol. 245(C).
    7. Jianqing Ruan & Qingwen Cai & Songqing Jin, 2021. "Impact of COVID‐19 and Nationwide Lockdowns on Vegetable Prices: Evidence from Wholesale Markets in China," American Journal of Agricultural Economics, John Wiley & Sons, vol. 103(5), pages 1574-1594, October.
    8. Tao Lian & Shamsheer ul Haq & Pomi Shahbaz & Lei Zhao & Muhammad Nadeem & Babar Aziz, 2022. "Changing Food Patterns during the Pandemic: Exploring the Role of Household Dynamics and Income Stabilization Strategies," Sustainability, MDPI, vol. 15(1), pages 1-20, December.
    9. Mojtaba Hajian Heidary, 2022. "A system dynamics model of the impact of COVID-19 pandemic and foreign direct investment in the global supply chain," Future Business Journal, Springer, vol. 8(1), pages 1-9, December.
    10. Ken McEwan & Lynn Marchand & Max Zongyuan Shang, 2021. "The Canadian pork industry and COVID‐19: A year of resilience," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 69(2), pages 225-232, June.
    11. Kazancoglu, Yigit & Ekinci, Esra & Mangla, Sachin Kumar & Sezer, Muruvvet Deniz & Ozbiltekin-Pala, Melisa, 2023. "Impact of epidemic outbreaks (COVID-19) on global supply chains: A case of trade between Turkey and China," Socio-Economic Planning Sciences, Elsevier, vol. 85(C).
    12. Li Cui & Hao Wu & Lin Wu & Ajay Kumar & Kim Hua Tan, 2023. "Investigating the relationship between digital technologies, supply chain integration and firm resilience in the context of COVID-19," Annals of Operations Research, Springer, vol. 327(2), pages 825-853, August.

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