Roy Endre Dahl

Demand Growth for Atlantic Salmon: The EU and French Markets

Abstract Two main factors have determined the development for successful aquaculture species—productivity growth and demand growth. However, while we have substantial knowledge of productivity growth, our insights are more limited for demand growth. In this article we investigate the demand growth for salmon in the EU and France using an index approach. Depending on exogeneity assumptions, the measure of demand growth will be either price or quantity oriented. The results indicate that demand growth has been substantial as it is 7.6% per year for the EU and 4.7% for France, on average. The demand growth is anything but smooth over time though, as there are several periods with negative demand growth as well as periods with substantially higher demand growth. JEL Classification Code: D12, Q22.

Fish Price Volatility

ABSTRACT This article investigates the volatility of fish prices on a global scale using trade data. The trade data is organized along four dimensions: Geographical market (import), production technology, species, and product form. This allows us to address several interesting questions such as volatility of prices of aquaculture products relative to capture fisheries, or how does volatility vary across species or product forms. In addition we compare the volatility of fish prices to other commodities to investigate their volatility in a broader context. Given the importance of trade in fisheries and aquaculture, our analysis also sheds light on the relative importance of price risk as part of trade revenue risk and the riskiness of various fish enterprises at the market level. JEL Codes: F1O, Q02, Q11.

PRICE TRANSMISSION IN NEW SUPPLY CHAINS—THE CASE OF SALMON IN FRANCE

In recent years there has been increased interest in the transaction forms in salmon markets, given that contracts have become more common, vertical mergers create firms that cover several levels in the supply chain, and futures markets have developed as a price risk tool. These are strong indications that salmon supply chains are developing in the same direction as supply chains for more processed food products. In this article we investigate to what extent this development has influenced the price transmission process for two product forms: a relatively unprocessed one (fresh fillets) and a more processed one (smoked salmon). Results indicate that the supply chain for fresh fillets can still be characterized by a high degree of price transmission. On the contrary, the hypothesis of full price transmission for smoked salmon is rejected.

Price Volatility in Seafood Markets: Farmed vs. Wild Fish

Price volatility has an important impact on seafood markets and the aquaculture industry. This article investigates price volatility regimes along three dimensions; technology, species and product form. We identify regimes using the Iterated Cumulative Sum of Squares (ICSS), which allow us to compare the volatility found in aquaculture products, as well as comparing against fish-meal and soybeans. The results help identify the level of price risk found within the aquaculture industry across species and products. In addition, we differentiate between technologies comparing wild-caught fish with aquaculture products. The results also help us consider the relative riskiness of aquaculture compared to other industries. The results indicate that in aggregate, price volatility for aquacultured products is substantially lower than for wild. However, this varies substantially between species.

Are Prices or Biology Driving the Short-Term Supply of Farmed Salmon?

Abstract The short-term relationships between the supply of farmed salmon and its market and biological determinants are not fully understood. In this article an econometric model of salmon supply is estimated exploiting monthly data on Norwegian salmon aquaculture. Our estimates indicate that supply has shifted over time due to innovations in several areas. We find that the price of farmed salmon has a limited effect on supplied quantity, giving a highly inelastic short-run supply elasticity. The biomass and seasonal factors are the main determinants of shifts in salmon supply in the short term. JEL Classification Codes: D22, Q11, Q22

A study on price volatility in the aquaculture market using value-at-Risk (VaR)

ABSTRACT Aquaculture production is increasingly important in seafood production and is currently the fastest growing food production technology worldwide. To continue the industry growth, price risk management is an essential part in creating successful projects and sustainable business operations. This research uses trade data on fish and invertebrate prices, and evaluates the relative price uncertainty from farmed and captured products. Moreover, we consider a set of species groups (fish, invertebrates), species’ families (e.g., Salmonidae, white fish and crustaceans), and individual species (e.g., salmon, seabream and prawns), and evaluate their price volatility over time using Value-at-Risk (VaR). The results indicate that the introduction of aquaculture production to a species’ total supply will reduce price volatility. Consequently, incentives and regulations should support research and development of new aquaculture species.

Are Oil and Natural Gas Going Separate Ways in the UK? Cointegration Tests with Structural Shifts

Previous analyses show that British spot market prices for gas follow the same pattern as the global oil price, i.e., we have an integrated market for energy. In recent years there are several developments in the British gas market that may call for a different price relationship. The spot market for gas has become more liquid, and an increasing fraction of gas is used for electricity generation - thus competing against coal and nuclear power. Moreover, there is an increasing LNG import, and there may have been a change in the perception of relative scarcity of oil and natural gas as well as the effectiveness of the OPEC cartel. Analysing more recent data and applying newer analytical tools that allow for endogenous structural shifts, we test whether oil and gas prices in the UK still are cointegrated. We find structural shifts in 2006 and 2007, and after the second structural shift, the evidence for oil and gas markets being cointegrated are much weaker. Specifically the stochastic trend in Brent oil seems less predominant in the movement of NBP gas price.

Volatility spillover in aquaculture and fisheries markets

Abstract While there have been a number of studies investigating the market integration between farmed and wild seafood, the relationship in terms of volatility has received little attention. However, with the high degree of market integration for similar species, one would also expect substantial volatility spillover. In this paper, we investigate the price volatility relationship between seafood from aquaculture and fisheries. Using trade data from 1990 to 2016, we assess both size and direction of volatility spillover over time, allowing us to evaluate the relative importance of both production techniques on seafood price volatility. Our results show a time-varying relationship as the level and direction of volatility spillover changes. Still, our results indicate that wild markets typically transmit price uncertainty to aquaculture markets, thus increasing the volatility in aquaculture markets. In addition, our results indicate that it requires a substantial (negative) supply shock to aquaculture production to shift volatility spillover from aquaculture to wild. These results add to previous studies confirming that prices of aquaculture products are less volatile than those of wild products and, in general, reduce volatility in seafood markets.

Societal safety: variations between modes and regions

In this paper, we use the economists safe city index, which is subdivided into four thematic sub-indexes to investigate correlations between the different safety dimensions, and investigate the impact of a number of facilitating factors. All dimensions of safety are positively correlated, but far from perfectly, indicating trade-offs or different priorities with respect to different safety dimensions. Wealthier cities, cities in North America and cities that have organised Olympic summer games, are found to be safer. Mega-cities and cities in the Middle East are less safe. Somewhat surprisingly, democracy and capital status have limited impact on safety.