The Impact of Animal Disease Outbreaks on China’s Meat Imports

We assess the effect of three animal disease outbreaks on China’s meat imports from 1992 to 2017, namely foot-and-mouth disease (FMD) for swine, bovine spongiform encephalopathy (BSE) for cattle, and highly pathogenic avian influenza (HPAI) for poultry. Using system-GMM and FGLS estimators, we find that outbreaks of animal diseases in exporting countries reduce China’s import of the meat products. Additionally, we find positive trade diversion and substitution effects in both FMD and HPAI but negative effects in BSE. Although these results indicate that China can accommodate its meat consumption needs through international trade now, we are skeptical that it can continue to do so if animal husbandry practices do not improve in China. This calls for major meat exporters to improve production efficiency and reduce the prevalence of animal diseases. With increasing environmental pressure and high dependency on imported feed caused by the expanding livestock sector, we recommend a sustainable diet by encouraging less consumption of meat.