Modeling international trade flows and market shares for agricultural commodities: a modified Armington procedure for rice

The Armington procedure (AP) has become increasingly popular in agricultural trade analyses. However, some arguments have arisen concerning the relevance of using the procedure for such analyses. This study examines the assumptions commonly made when using the Armington procedure and suggests modifications for agricultural trade analyses. Results from models utilizing rice-trade data suggest that the assumptions of the single constant elasticity, in particular, may not be appropriate for analyzing agricultural trade. These results also suggest that, with proper modifications, the AP can be applied to agricultural trade. Further, results of a modified Armington procedure indicate that trade in rice exports is highly competitive and that changes in market shares of individual exporters are not independent of changes in budget expenditure allocated to imports.     

‘Deal’ or ‘No Deal’? Impacts of Alternative Post‐Brexit Trade Agreements on UK Agriculture

Brexit will have important implications for UK agricultural commodity markets due to potentially significant changes to trade flows. We quantify the sectoral impacts on UK agriculture of three illustrative scenarios, which capture a broad range of potential trade arrangements: Bespoke Free Trade Deal , WTO Default and Unilateral Trade Liberalisation . It is estimated that the projected market impacts are relatively small if the UK negotiates a Bespoke Free Trade Agreement with the EU. The projected impacts are much greater under the two other scenarios, which capture potential trade arrangements if ‘no deal’ is reached. The high tariffs imposed under the WTO default scenario lead to significant adjustments in trade between the UK and EU‐27, with the impact on the domestic UK market depending on whether the UK is a net importer or a net exporter of the relevant commodity. All sectors experience price and production declines under the trade liberalisation scenario in which the UK unilaterally sets tariffs on imports from both the EU‐27 and the rest of the world to zero; the impacts are particularly severe in the beef and sheep sectors where international competition is very strong.     

International trade in a differentiated good: Trade elasticities in the world rice market

In many previous rice trade models, the commodity has been regarded as a homogeneous product. However, homogeneity is not an appropriate assumption, given the various types of rice that are traded and consumed. Parameters estimated from these models, therefore, do not reflect the real world market for rice and, hence, may mislead decision makers who use the results for policy evaluation purposes. This study uses an Armington approach to model the world rice trade as a differential good market and to derive trade elasticity parameters.     

Trade Liberalization,Policy Reform and the U.S. Sugar Industry

This study examines the prospects for and potential impacts of liberalized international trade in sugar. It utilizes a state specific, cost of production based estimate of U.S. sugar supply to examine producer surplus under the current sugar policy regime and under a free trade scenario. It also evaluates the long-term viability of sugar production in individual states at free market prices.     

A generalized Armington trade model: Respecification

Even if the original version of the Armington model is simple and plausible in estimation, the single CES and homotheticity assumptions are too restrictive for practical application and give biased price elasticities. This paper develops a generalized Armington model, which relaxes the single CES and homotheticity restrictions, and includes the Armington model as a special case. The Armington and generalized Armington trade models are applied to the Japanese meat import demand to demonstrate their performance. The empirical results rejected the two assumptions imposed on the Armington model. The generalized Armington model provides an alternative to the restrictive but indispensable Armington model.     

Issues Affecting the U.S. Poultry Industry and International Poultry Trade

Abstract

This study was conducted to examine issues and concerns that may affect the future direction of the U.S. poultry industry and international poultry trade. Given the economic contribution of the poultry industry, it is important to have some understanding about the future direction of the industry, both at the national and international levels. To generate the information required, this study surveyed the top poultry producers in the country as well as specialists and experts in the industry. Although both the producers and specialists believe that the industry has a bright future, they also think that the rapid production growth experienced by the poultry industry in the past two decades cannot be sustained. Growth restrictions in the industry will come from a variety of sources such as environmental waste management, food safety, labor shortages, animal welfare, and increased foreign competition.     

An Analysis of Removal of Agricultural Trade Barriers between the United States and Canada with Emphasis on the Southeast

A four-region, 23-commodity small world agricultural trade liberalization model within the SWOPSIM framework is used to measure the impact of tariff removal between the United States and Canada. The tariffs are simply defined as negative import subsidy equivalents in the model and are then removed from the trade prices. The model recalculates domestic supply and demand levels in all regions, rebalancing world trade, production, consumption and prices. In summary, the impacts of the Canada-U.S. Trade Agreement on selected commodity groups are significant. Canadian imports of beef and veal, poultry meat, soybean oil and fresh strawberries increase. Furthermore, the results indicate larger trade flows for selected products and declines in producer and consumer prices in Canada, U.S. and Southeast regions. Since the U.S. share of Canadian agricultural imports averaged 60% in the 1980s, the impact of trade liberalization will be greater in Canada in selected commodities than in the U. S. or the southeastern region, and Canadian dependence on the U.S. market will be increasing in the future. The tariff phaseout, together with a reduction in nontariff barriers and harmonizing of domestic agricultural policies, will create more export opportunities in selected commodities for both the United States and Canada, and will create the world's largest free trade market.     

新一轮多哈贸易自由化对中国农业的影响

多哈贸易自由化对中国农业的影响一直存在很大争论。与以往的研究不同,本文应用一般均衡模型GTAP与局部均衡模型CAPSIM对接的方法测算新一轮多哈贸易自由化对中国农业的影响。研究显示,贸易自由化总体上对中国经济有正面的影响,只不过影响幅度很小,但农业部门会在多哈自由化中享受相对较大的贸易优势;从分产品的贸易和生产来看,粮食作物、果蔬等产品有正的影响,而对畜产品和食糖会有负的影响;虽然贸易自由化对中国农民收入来说只有很小的正面影响,但这种影响在不同收入组之间差别很大,其中高收入组农民要比低收入组农民受益更多,贸易自由化在一定程度上会使农民的贫富差距拉大。     

Avian influenza,non‐tariff measures and the poultry exports of China

This paper focuses on the direct impact of avian influenza outbreaks and the impact of the consequent non‐tariff measures (NTMs) on the international poultry trade. Using monthly export data from China and its 122 poultry importing countries, a random‐effect gravity model has been adopted. Emphasising the agri‐food trade in a global value chain context, the research analysis distinguishes between ‘agri‐food goods’ (mostly uncooked poultry products) and ‘processed goods’ (mostly cooked poultry products). The results show that domestic avian influenza outbreaks have a significant negative impact on a country's poultry imports compared with such outbreaks in exporting countries. Moreover, NTMs induced by avian influenza reduce the uncooked poultry trade but temporarily increase the cooked poultry trade. However, with a time‐lag, the cooked poultry trade may soon face increasing NTMs. The results also imply that developing countries that attempt to export agri‐food products to developed countries should increase and enhance processed food production.     

Integrated regional impact assessment of agricultural trade and domestic environmental policies

It remains challenging to derive general findings and conclusions from either economic theory or empirical studies on the relationship between international trade and the regional environment. Consequently, we aim to analyse environmental effects of agricultural trade policies in the Austrian Marchfeld region. We apply an integrated modelling framework that accounts for heterogeneity in agricultural production and environmental outcomes. Scenario analysis is applied to assess regional impacts of different trade policy scenarios. Sensitivity analyses reveal the relative influence of model parameters on outputs. The results indicate that lower domestic tariffs have small beneficial effects on the regional environment. The regional environmental impacts highly depend on the changes in world crop prices through global trade agreements. A laissez-faire market scenario that includes the elimination of trade barriers and agri-environmental payments (AEPs) leads to substantial environmental deterioration. Hence, the alignment of AEPs with WTO trading rules remains an important issue in the trade and environment debate.     

Russian Roulette at the Trade Table: A Specific Factors CGE Analysis of an Agri‐food Import Ban

In the summer of 2014 Russia imposed a ban on most agri‐food products from countries enforcing Ukraine‐related sanctions against Russia. We use a specific factors computable general equilibrium (CGE) model to simulate the short‐run impact of this retaliatory policy. The baseline is carefully designed to isolate the impacts of the ban on the European Union (EU), Russia itself and a selection of key trade partners. The modelling of the ban follows a novel approach, where it is treated as a loss of established trade preferences via reductions in consumer utility in the Armington import function. Not surprisingly, the results indicate that Russia bears the highest income loss (about €3.4 billion) while the EU recovers part of its lost trade through expansion of exports to other markets. An ex‐post comparison between simulation results and observed trade data reveals the model predictions to be broadly accurate, thereby validating the robustness of the modelling approach.     

Alternative Methods for Estimating Price Elasticities of Imports

Abstract

This article compares three commonly-used methods for estimating import price elasticities: (1) trade-weighted price elasticities of domestic demand and supply along with price transmission; (2) direct estimates based on ad hoc import demands; and (3) Armington model estimates. Using data from El Salvador's grain markets (white maize, red beans, and rice), the results indicate that the second method provides the most reliable estimates and that the Armington procedure may not be appropriate for estimations of this type. However, the first method offers the best guesstimates to assess potential rather than historical import response as trade is liberalized.     

浙江省林产品贸易现状及其国际竞争力提升途径

浙江既是经济大省又是资源小省,入世后国际市场国内化、国内市场国际化趋势日趋明显。如何有效利用国际国内两个市场、两种资源,扩大木质林产品进口缓减资源短缺压力,同时提高非木质林产品市场竞争能力扩大出口,是今后浙江林业发展的重要战略选择。本文通过对1997～2002年浙江主要林产品进出口情况进行分析,认为浙江林产品进出口贸易具有:⑴进出口规模小,但增长幅度快;⑵进口林产品以木质资源为主,具有较强的资源补缺作用;⑶出口林产品结构不断优化,附加值不断提高等特点。在分析林产品国际贸易环境新变化的基础上,提出了提升浙江省林产品国际竞争力的具体途径。     

Productivity growth, catching-up and uncertainty in China''s meat trade

The potential role of China as a major importer of agricultural products, and the likely impact on world markets has been a topic of considerable debate over the past decade. In this paper, we focus specifically on the livestock sector and develop a detailed analysis of productivity growth in China’s pig and poultry production along with projections of China’s likely meat trade in the year 2010. We use a general equilibrium model which permits us to explore the sensitivity of our projections to macro-economic uncertainty as well as uncertainty in livestock productivity growth rates. Our analysis shows that China’s net trade position is very sensitive to both of these factors. With high livestock productivity growth and a slow-down in the rest of the economy, China could be a substantial competitor in export markets by 2010. On the other hand, slow productivity growth in livestock production, coupled with a rapidly growing macro-economy could transform China into a major market for future meat exports.     

人民币汇率变动对我国水产品贸易的影响

水产品外贸在我国外贸、特别是在农产品外贸中占有重要的地位。本文在论述了人民币升值对水产品贸易影响的一般原理和过程的基础上，讨论了人民币汇率变动对水产品贸易所产生的其他效应，包括：对于加工贸易和当进出口商品需求弹性之和小于1时，人民币升值会促进出口；人民币升值有利于改善我国水产品的贸易条件，使社会福利增加；人民币升值会使我国水产品贸易规模增大。最后本文给出了结论与建议。     

INSTABILITY IN WORLD GRAIN MARKETS

The paper discusses the nature of international price variability for wheat and coarse grains. In particular, it explores the relationship between variability in national grain markets and international trade. Empirical evidence is presented on the degree to which short-run fluctuations in domestic grain production are transmitted to the world market by major countries or country aggregates, and on their absorption of international market variability. The impact of possible structural or policy changes upon future international price variability is explored. It is argued that multilateral action to promote greater international stability should focus on the modification of domestic storage policies to reduce the transmission of short-run domestic fluctuations in supply or demand to world markets.     

新冠肺炎疫情冲击粮食安全:趋势、影响与应对

新冠肺炎疫情在全球加速扩散蔓延,引发全球粮食市场异常波动以及对中国粮食安全的担忧。疫情对后期全球粮食生产与贸易的影响将进一步加大,全球粮食市场波动有可能进一步升级。随着全球金融市场充分释放流动性,国际投机资本若炒作农产品市场,爆发类似2008年粮食危机的风险将越来越高。分析表明,中国粮食安全保障体系总体上可从容应对全球粮食市场波动升级的挑战,但大豆等农产品进口需防控国际市场波动风险。本文认为,要高度重视全球粮食市场波动的可能风险和挑战,必须加强监测、及早谋划,系统应对、综合施策。包括:有效管控输入性不稳定预期对国内粮食市场的干扰和冲击;进一步强化粮食生产能力建设;构建国家粮食安全保障风险治理体系;完善重要农产品储备体系;强化农产品全球供应链管理;加强国际粮食安全、贸易和投资政策协调。     

The International Competitiveness of the Palestinian Agriculture

The purpose of this study is to identify and measure the impacts of factors which are expected to influence the competitiveness of the Palestinian agriculture by using the market share approach with an econometric model. Over the past three decades, Palestinian agriculture has been subjected to increased international and regional competition. The impact of this competition is in part evidenced by trend decline in the West Bank and Gaza Strip agricultural exports in one hand, and the increases in agricultural imports on the other. The empirical results indicate that the performances of domestic and import market shares could be increased through improving the productivities of the major production factors such as land, labor and capital. Applying this policy would enhance the competitiveness of Palestinian agriculture by increasing local production to replace farm imports from Israel. On the other land, future farm export competitiveness will be closely linked to improvements in production, marketing efficiency and removing non-tarrif trade barriers (NTBs) imposed by Jordan and Israel.     

Determinants of a social clause in international trade negotiations

Survey data are used to examine the determinants of a “social clause” in international trade negotiations. Proponents of such a clause argue that the inclusion of labor laws, environmental impacts, and other social issues in international trade negotiations would ensure fair competition, an equitable distribution of the benefits of free trade, and, in the case of labor, protect the basic rights of workers. Opponents see these arguments as a disguised form of protectionism and self‐interest based on the protection of labor‐intensive industries in developed countries. Results from a logit model indicate a decreased likelihood for the inclusion of a social clause in international trade negotiations across farm sizes. In particular the results suggest that agricultural producers with annual gross sales including government payments between US$500,000 and US$999,000, are 40% less likely to want labor laws, environmental impacts, and food safety standards to be included as part of international trade negotiations. The results also show that agricultural producers with college experience or college degrees are less likely to want these social interventions while second generation farmers and first generation farmers with a master's degree want labor laws, environmental impacts, and food safety standards to be included as part of international trade negotiations.     

Multilateral Trade and Agricultural Policy Reforms in Sugar Markets

We analyse the impact of trade liberalisation, removal of production subsidies and elimination of consumption distortions in world sugar markets using a partial‐equilibrium international sugar model calibrated on 2002 market data and current policies. The removal of trade distortions alone induces a 27% price increase while the removal of all trade and production distortions induces a 48% increase in 2011/2012 relative to the baseline. Aggregate trade expands moderately, but location of production and trade patterns change substantially. Protectionist Organisation for Economic Co‐operation and Development (OECD) countries (the EU, Japan, the US) experience an import expansion or export reduction and a significant contraction of production in unfettered markets. Competitive producers in both OECD countries (Australia) and non‐OECD countries (Brazil, Cuba), and even some protected producers (Indonesia, Turkey), expand production when all distortions are removed. Consumption distortions have marginal impacts on world markets and the location of production. We discuss the significance of these results in the context of mounting pressures to increase market access in highly protected OECD countries and the impact on non‐OECD countries.