After the spread of Coronavirus, the worldwide economy has changed significantly, particularly

the medical mask market. In particular, there has been an abundance of fluctuations in the
Chinese facemask market. According to Bennehard (2020), before the coronavirus outbreak,
China's market was given an impulse to trade by pollution concerns, especially air pollution.
After the emergence of Coronavirus in Wuhan, the medical mask market obtained more
opportunities to enhance.

P
S Supply and Demand curve from 2019
to the early 2020

- The demand curve shifted to right

due to the consumers’ expectation
P1 and the increase in number of
consumers.

- The supply curve remained.

P0 D1 → The upward trend in prices and
quantities.

D0
Q0 Q1 Q
Since December 2019, facemasks were considered as a piece of efficient equipment to protect
people from Coronavirus. These items becoming indispensable goods in daily life, were highly
consumed in China (Bennehard, 2020). Due to the consumers' expectations about COVID-19,
the demand for face masks rose dramatically. Wu et al. (2020) report that after the
confirmation of human-to-human transmission, on January 20, 2020, panic-buying of facemask
was announced. Moreover, the number of consumers accelerated, resulting in the rise in
facemasks' demand. BBC News (2020) reveals that there was 500,000 medical staff who were
asked to wear and change facemasks four times a day, which might require 2 million facemasks
per day in Hubei province. Also, the universal facemask-wearing policy implementation in all
China regions could cause a boom in consumers' numbers (Wu et al., 2020). From these above
changes, the demand curve shifted to the right.
Besides, on account of the upward trend in demand, the medical masks might see a
considerable increase in their price. BBC News (as cited in Kristies, n.d.) confirms that between
November 2019 and January 2020, the price of a box comprising 20 masks rose from 178 yuan
($27.49) to 1,100 yuan ($158). According to Wu et al. (2020), the growth of facemasks' prices
was also reported right after the announcement of human-to-human transmission.
Furthermore, based on the law of supply, if there is an upward trend in prices, the quantity can
also grow. According to Kristie (n.d.), Cao Jun, a manager of Lanhine - a mask manufacturer in

P
S
 Pe

Ningbo city, points out that their production rate went up from 400,00 to 200 million medical
P D1 in medical masks' production
masks per day. Between12019 and 2020, there was a marked rise
volume, from 5 billion to 10 billion (Thomala, 2020).
Shortage

QS Qe QD Q

Nevertheless, even though the number of quantities climbed up, China had to deal with the
shortage of face masks when the quantity demanded was more than the quantity supplied. At
the beginning of the COVID-19 outbreak, on January 3, 2020, one week after the explosion, the
shortage of medical masks was reported nationally (Bennehard, 2020). Moreover, as suggested
by Wu et al. (2020), 20 million face masks producing each day might not meet the demand of
1.4 billion Chinese under a universal face mask-wearing policy in the whole of China.
Accordingly, to stabilize the medical mask market, between January 24, 2020, and February 29,
2020, the Chinese government decided to import over 2 billion surgical face masks. Also, they
broaden the Chinese New Year holiday to allow for home quarantine to decline the need for
face masks and other medical resources. Additionally, on January 25, 2020, they also
introduced the product's price controls (Wu et al., 2020). As a result, the shortage of medical
masks was eventually supervised, and the price gradually rose to the equilibrium price.
Bennehard, M. (2020). The face mask market in china: an enforced growing trend | daxue
consulting, Daxue Consulting. Retrieved from https://daxueconsulting.com/anti-pollution-mask-
industry-in-china/
BBC News (2020). Coronavirus: Does China have enough face masks to meet its needs?.
Retrieved from https://www.bbc.com/news/world-asia-china-51363132
Kristie, M. (n.d.). The upward trend in medical mask prices: is there room for ethics in
economics?, citizen.c. Retrieved from
https://owl.purdue.edu/owl/research_and_citation/apa6_style/apa_formatting_and_style_gui
de/reference_list_electronic_sources.html
Thomala, L., L. (2020). Annual production volume of face masks in China 2017-2021, Statista.
Retrieved from https://www.statista.com/statistics/1099824/china-face-mask-annual-
production-volume/
Wu, H., I., Huang, J., Zhang, C., J., P., He, J., Minga, W., K. (2020). Facemask shortage and the
novel coronavirus disease (COVID-19) outbreak: Reflections on public health measures [PDF
file]. Retrieved from https://www.thelancet.com/action/showPdf?pii=S2589-
5370%2820%2930073-0