Influence of extreme weather stresses and synchrony of crop yield on formation and volume of the international wheat trade

Extreme weather events, such as heat and drought, may lead to sharp drops in crop production or disruptions to the transportation and storage of crop products, and consequently result in shortage of food supply for a nation or even the globe. International crop trade can potentially relief such shocks, but little is known about whether and how the occurrence of extreme weathers affects the establishment of trade connections between countries and their trade volumes. Using international wheat trade as an example, we investigated the trade linkages obtained from FAOSTAT for 99 countries for the period of 2005-2014. In addition to factors that have been often considered as important for the formation of trade linkages between countries (e.g., common official language, distance, and contiguity), we proposed and tested two novel factors: 1) network of extreme weather stresses (i.e., heat, cold, flood, and drought), and 2) network of short-term synchrony of crop yield anomalies between countries. The nature of these factors is complex due to their nonstationary space-time structure and highly-nonlinear relationships among them. To address these challenges, we developed a network model to quantify the effects of extreme weather events and synchrony of yield on the international wheat trade network. To model the highly-nonlinear structure, we also used machine learning approaches.

The preliminary results demonstrate that a country tends to have more trade partners and import more when it faces more frequent extreme weather stress. However, trade partnerships are more likely to exist between countries with more synchronized yield variation for the modeling period, even considering countries that are contiguous, closer in distance, or with common language have higher chances of trade in the model. The higher likelihood of trade link formation in countries with synchronized yield variation reveals the potential risks in the current trade network: food supply may be destabilized when there is a synchronous failure in yield for trade partners; and such disruption may have acute impacts especially on low-income import-dependent countries.