Impact of trade policy measures on agricultural markets during global disruptions – A multicountry analysis.

The past COVID-19 pandemic has led to severe economic consequences worldwide. The global health crisis has affected supply and demand, both domestic and international. However, the shock has been noticeably heterogeneous across sectors. Since the onset of the pandemic, agricultural markets have been resilient compared to other industries, in part due to moderately stable international trade flows. Are export restrictions less determinant than in previous crises? Have countries adopted a more trade-promoting approach compared to the previous food price crisis a decade before? This study evaluates trade policy interventions adopted since the onset of the pandemic, using a gravity setting with data on monthly trade flows. Overall, our findings suggest that government interventions have had a more positive effect on agricultural trade compared to the 2007–2008 crisis. Despite initial and short-lived export restrictions, governments have largely focused on facilitating trade flows. The most significant effect has come from trade-promoting measures and the benefits translated into enhanced trade across all regions. Some of these practices, such as acceptance of digital import documentation, could be established on a permanent basis, while others, like temporary elimination of import quotas, might be considered as efficient interventions for future crises. Products of animal origin were most affected by import restrictions, highlighting the importance of timely and accurate international notification of potential health risks to avoid speculation and market disruptions. Food import-dependent nations remain vulnerable to crises due to their sensitivity to export restrictions, even when temporary. Therefore, keeping a certain level of stock in key staple foods as well as a diversified portfolio of trade partners is imperative to ensure the resilience of domestic food markets.