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Law360 (August 27, 2020, 9:25 PM EDT ) The World Trade Organization provided a measured snapshot of a "resilient" global agricultural sector recovering from production lags caused by the COVID-19 pandemic in a report published Wednesday, saying that plenty of food is available — for people who can afford it.
Contrary to the overall trend for merchandise exports, which fell in the first half of 2020, food exports continued to grow into April, facilitated by tariff reductions, stockpiling and stimulus packages, the WTO reported. But despite ample supplies, the pandemic's accompanying economic crisis has led to an increase in hunger globally.
"While world food stocks and production levels for the most widely consumed staples — rice, wheat and maize — are at or near all-time highs, and lower prices in principle make food more affordable, the COVID-19 pandemic's impact on jobs and incomes has increased the number of hungry people," the report said.
The WTO divided pandemic food security policies into two phases. Governments initially sought to ensure short-term food availability while trying to stop the coronavirus's spread through their populations. Those policies soon gave way to measures to support agricultural producers and mend supply chains as lockdowns started to relax, the report said.
In one example of crisis management, the report said that travel restrictions had led to wastage of some crops in countries that depend on migrant farmworkers for their harvests, but governments "moved rapidly" to facilitate seasonal workers' entry and to classify agricultural, food processing and distribution jobs as essential, decreasing labor shortages.
However, the report made clear that many countries were not ensuring access to food for those whose livelihoods had been harmed by the pandemic.
"Producing and storing enough food is not sufficient if it does not reach those in need," the WTO said. "By contributing to the availability and affordability of food, trade remains a crucial part of the solution to countries' food security concerns — particularly at a moment when people's incomes are under pressure."
The WTO cited UN World Food Programme statistics released in June that predicted the number of people facing food insecurity could climb to 270 million by the end of the year, an 82% increase since before the pandemic.
According to the UN, pandemic-related increases in food insecurity have been most pronounced in South and Central America, where the demand for food assistance tripled in 2020.
At the same time, the WTO reported that South America's agricultural export market fared better than other regions, including Europe and North America, with exports increasing compared to the same period in 2019. The report attributed the growth to "Asian demand for the region's exports of products such as soybeans, sugar and meat."
While demand for edible agricultural products stayed relatively steady through the pandemic, the WTO pointed to steep drops in consumers' drive to buy nonfood agricultural products, such as furs, essential oils and flowers.
"Trade in agricultural products has been more resilient than overall trade," the WTO said. "This reflects the essential nature of food and the resulting relative income-inelasticity of demand for it."
The WTO praised member countries for efforts to help agricultural producers manage abrupt shifts in demand, such as sending surpluses to food aid programs and facilitating access to credit.
The latter reflected the fact that agricultural revenues were already down prior to the arrival of COVID-19 as food prices had been trending south. They rose slightly in June, according to the WTO, but the organization forecast that food prices would remain low for the duration of the economic downturn.
"There is currently no supply-related reason why the ongoing health crisis should turn into a food crisis," the WTO concluded, cautioning that keeping global supply chains open was the best way to guarantee food security. "Governments' trade policy choices will play a major role in shaping how the situation evolves."
--Editing by Abbie Sarfo.
For a reprint of this article, please contact reprints@law360.com.
