Following the massive setback of an estimated 4.2% global economic contraction in 2020 due to COVID-19, 2021 will likely see a rebound of similar proportions. Although any misstep, whether in new outbreaks or vaccine rollouts, will cast a long shadow of doubt on economic growth this year, a successful defence against the virus may boost global per capita incomes. The big question remains how the health and economic fallouts from COVID-19 will intersect with climate change and geopolitical tensions to impact agricultural production and trade this year.
Last week, we described the influence of those three forces on Canadian red meat sectors. This post looks how these forces may alter global markets for oilseeds, pulses, and wheat.
COVID and the world’s net crop importers: where the virus’ power ends
Many countries can’t grow enough staple crops to meet their domestic consumption needs. Japan, for instance, has a large population and tiny land resources. China has much more land but a massive population. The green and purple bubbles in the figures below (lower-income and higher-income countries, respectively, above the red line) highlight some of Canada’s best global opportunities. These represent net importers – countries that consume more than they produce.
As a net exporter, Canada produces more major field crops than we consume as food, feed or fuel. That means opportunities for Canada as a trusted, reliable supplier of high-quality crops in 2021 – opportunities to meet the needs of net importers that even a virulent virus isn’t likely to diminish.
Consumption and production – or how exports are made
The location of each bubble in the charts below is based on their supply and demand factors in 2019. The consumption/production (CP) ratio is consumption volumes/ production volumes. Because those factors will change in 2021 due to any combination of COVID, climate change and geopolitical tensions (amid other lesser forces), the bubbles’ locations may also change.
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