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Coronavirus 2019 (COVID-19) has caused ongoing disruptions to U.S. meat markets via demand and supply-side shocks. Abnormally high prices have been reported at retail outlets and meat packers have been accused of unfair business practices because of widening price spreads. Processing facilities have experienced COVID-19 outbreaks resulting in shutdowns. Using weekly data on wholesale and retail prices of beef, pork, and poultry, we characterize the time series behavior and dynamic linkages of U.S. meat prices before the COVID-19 pandemic. We model vertical price transmission using both linear and threshold autoregressive (AR) models and vector error correction (VEC) models. With the estimated models, we then compare price movements under COVID-19 to model predictions. All three meat markets are well-integrated and we observe unexpected, large price movements in April and May of 2020. Early COVID-19 related shocks appear to be transitory with prices returning to expected levels at a pace consistent with the speed of transmission prior to the pandemic. This well-functioning market process suggests a degree of resilience in U.S. meat supply chains. USDA-NIFAUnited States Department of Agriculture (USDA) Published version This research was supported by USDA-NIFA Project: COVID-19 Rapid Response: Coronavirus Disease 2019, Price Transmission, and the Farm-Retail Price Spread in U.S. Livestock. The views expressed here are those of the authors and cannot be attributed to the Economic Research Service or the U.S. Department of Agriculture.

This report addresses various aspects of the impact the COVID-19 pandemic has had on Virginia’s farm and agribusiness sector as of the beginning of May 2020. At the time of this writing (May 7, 2020) the Centers for Disease Control and Prevention reports approximately 1.2 million cases of coronavirus disease 2019 (COVID-19) in the United States, and over 70,000 deaths.1 Virginia’s Department of Public Health reports over 21,000 cases and over 700 deaths.2 33.5 million people have filed for unemployment claims in the United States since mid-March.3 The economic impacts of the disease have been felt much more broadly, as businesses have been forced to close or operate under different conditions, and as consumer spending power declines. As we look ahead, there is tremendous uncertainty about how the pandemic will end and how it will affect the global economy and our individual lives and livelihoods both in the short term and permanently. This report includes a general economic outlook, by Matthew Holt; overviews of the pandemic’s disruptions to the U.S. food supply chain and several major agricultural industries in Virginia, by John Bovay; an overview of agricultural policy under the pandemic, by Jennifer Friedel; a detailed analysis of effects of the pandemic on Virginia grain markets, by Olga Isengildina Massa and Patrick Kayser; an overview of results of a national survey of the impacts of the pandemic on aquaculture producers, with a focus on Virginia’s main aquaculture products, by Jonathan van Senten; and analysis of the current state of affairs for U.S.-China agricultural trade, by Jason Grant, David Orden, and Mary Marchant.