Publication Date

3-2020

Series Number

20-WP 600

Abstract

Our paper estimates the economic impact of an outbreak of African Swine Fever on US agriculture. The immediate impact of an outbreak would be the closure of international markets to US pork—even countries that have the disease prohibit pork imports from other countries with the disease. We evaluate two scenarios—one assumes that the disease spreads to feral swine and that the United States is unable to eliminate the disease over the ten-year projection period (the all-years scenario); and, the second scenario assumes that the United States gets the disease under control and reenters export markets within two years. The immediate impact of both scenarios is a 40%–50% reduction in US live hog prices, which is needed to clear the market of surplus pork that would otherwise be exported. In the all-years scenario the US pork industry downsizes after about five years of losses and remains at lower output levels for the remainder of the period, which results in large employment losses. In the two-year scenario, the industry faces a period of large financial losses but is back in the export markets before significant downsizing begins. Pork industry revenue losses add up to $15 billion in the two-year scenario and a little over $50 billion in the all-years scenario. Nationwide employment losses equal 140,000 jobs at the end of 10 years in the all-years scenario. There are almost no job losses at the end of 10 years for the two-year scenario. Iowa job losses in the all-years scenario are 22,000 by year ten.

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