An econometric analysis of global salmon market prices and its implications for the Alaska wild salmon industry

Holzinger, Abby C.

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Abstract

The Alaska wild salmon industry has gone through a period of low prices and changing markets in the past two decades. Average exvessel prices have dropped from $1.46 per pound in 1988 to $0.35 per pound in 2005, due in large part to increased volume of farmed salmon and marine-reared rainbow trout. This thesis examines the potential price and revenue effects from the interaction between wild Alaskan salmon and anticipated production increases of farmed salmon from Chile. To investigate these linkages I developed an international simultaneous equilibrium market model for wild and farmed salmon and marine-reared rainbow trout. While world-wide farmed salmon (and trout) and the various wild Alaskan salmon species are not identical products, they are close substitutes. Changes in the volume of aquaculture production substantially affect the market-clearing prices of wild salmon. This model will then be used to simulate potential changes in Chilean farmed salmon production and Alaska wild salmon production on salmon exvessel prices in Alaska.

Description

Thesis (M.S.) University of Alaska Fairbanks, 2007

1. Introduction -- Research objectives -- Thesis organization -- 2. Background of wild and farmed salmon -- The wild Alaska salmon fishery -- International salmon aquaculture -- Salmon demand on the world market -- Japan and Chilean salmon farms -- Alaska Finfish farm moratorium -- 3. Salmon demand model -- Introduction -- Salmon nomenclature -- Salmon demand equations -- United States inverse demand functions -- United States inverse demand for Chilean Atlantic salmon -- United States inverse demand for Canadian Atlantic salmon -- Japanese inverse demand functions -- Japanese inverse demand for Chilean coho -- Japanese inverse demand for Chilean trout -- Japanese inverse demand for Norwegian trout -- Japanese inverse demand for United States sockeye -- Salmon allocation equations -- Allocation of Chilean Atlantic salmon to the U.S. -- Allocation of Canadian Atlantic salmon to the United States -- Allocation of Chilean coho to Japan -- Allocation of Chilean trout to Japan -- Allocation of Norwegian trout to Japan -- Allocation of United States sockeye to Japan -- Alaska exvessel price equations -- Alaska exvessel price for sockeye -- Alaska exvessel price for Chinook -- Alaska exvessel price coho -- 4. Econometric model results -- Salmon market model estimation -- United States inverse demand for Chilean Atlantic salmon -- United States inverse demand for Canadian Atlantic Salmon -- Japanese inverse demand for Chilean coho -- Japanese inverse demand for Chilean trout -- Japanese inverse demand for Norwegian trout -- Japanese inverse demand for U.S. sockeye -- Allocation of Chilean Atlantic salmon to the U.S. -- Allocation of Canadian Atlantic salmon to the U.S. -- Allocation of Chilean coho to Japan -- Allocation of Chilean trout to Japan -- Allocation of Norwegian trout to Japan -- Allocation of U.S. sockeye to Japan -- Alaska exvessel price for sockeye -- Alaska exvessel price for chinook -- Alaska exvessel price for coho -- Goodness-of-fit -- 5. Predictions and conclusions -- Sensitivity analysis -- Scenario 1 : Increased Chilean exports of Atlantic salmon -- Scenario 2 : Increased Chilean exports of coho -- Scenario 3 : Chile increases export of trout -- Scenario 4 : Increased Chilean exports of coho and trout -- Scenario 5 : Adjustments to Alaskan coho harvests -- Scenario 6 : Adjustments to Alaskan sockeye harvests -- Scenario 7 : Adjustments to Alaskan Chinook catches -- Discussion -- References.

Date

2007-05

Type

Thesis

Collections

Economics