Effects of COVID-19 on Iran’s Livestock and Meat Market

Document Type : Original Research

Author
M. Ronaghi
Department of Agricultural, Food and Resource Economics, College of Agricultural and Natural Resources, Michigan State University, USA.
Abstract
The recently emerged Coronavirus (COVID-19) has been identified as an pandemic by the World Health Organization (WHO) and has affected all sections of human society including agriculture, livestock, manufacturing, and industry. In this research, we investigated the impact of COVID-19 on Iran’s livestock and meat market by using an equilibrium displacement model. The prevalence of the Coronavirus has had the greatest economic effects on rising exchange rates and has reduced exports in Iran. The results also show that the factors of the Coronavirus (exchange rate and exports) have the highest effect on Iran’s meat market. The rising exchange rates and reduced exports lead to higher prices and lower quantities in the meat market, which increase the suppliers’ welfare at the retail and farm levels. These results show the negative effect of the outbreak of Coronavirus. Corona outbreak increases price at the farm and retail level, therefore, farm and retail quantities fall. Since the impact of an increase in the price is much greater than the effect of reducing production, producer surplus increases. A policy conclusion of this research is that the current situation in Iran is difficult for the poultry and livestock industry because of the need for foreign currency and the abuse of market power in the distribution system. Farmer cooperatives can overcome these problems because their objectives are to serve farmers and their goals align with farmers goals.

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References
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Journal of Agricultural Science and Technology
Volume 24, Issue 5
September and October 2022
Pages 1017-1028