Spatial Price Transmission in the Regional Maize Markets in Ghana

Policy makers have been striving through market reforms to ensure proper functioning of agricultural markets and marketing channels to ensure food security, realize welfare impacts from policies, bridge the gap between the affluent and deprived regions. The core of which is due to regional ecological differences among other factors. In addition, the purported ability of marketing participants to influence the conduct of the market and respond to certain price shocks more faster/slowly than others warrants examining the regional maize market linkages within the past decade. Using regional monthly wholesale price data from 2002 – 2010, the consistent threshold autoregressive model is employed for the study considering the robustness and the limitations of other approaches. Results indicate that regional maize markets are integrated. Bidirectional market interdependence was found between market pairs both in the short and long run. The long run causality was however heterogeneous with respect to positive and negative shocks. The nature of price adjustment is asymmetric and traders respond quickly when market margins are squeezed than when stretched for all market pairs except between Brong Ahafo and Greater Accra market pairings. The time path needed for adjustment ranged from 7 to 26 months. The minimum adjustment time was 7 months occurring between Brong Ahafo - Greater Accra markets linkage for positive deviations and Brong Ahafo - Ashanti market for negative deviations. The recent expansion in communication infrastructure motivates the regional market integration. This implies that resources should be allocated to transportation development; the main hindrance to trade. The suboptimal condition of asymmetry is also motivated by inventory behaviour of traders but this remains a testable hypothesis. Traders in Greater Accra are slow in passing on price increases for the fear of loss of goodwill and/or loss of customer share given the multiple sources of supply

Spatial Price Transmission in the Regional Maize Markets in Ghana

Policy makers have been striving through market reforms to ensure proper functioning of agricultural markets and marketing channels to ensure food security, realize welfare impacts from policies, bridge the gap between the affluent and deprived regions. The core of which is due to regional ecological differences among other factors. In addition, the purported ability of marketing participants to influence the conduct of the market and respond to certain price shocks more faster/slowly than others warrants examining the regional maize market linkages within the past decade. Using regional monthly wholesale price data from 2002 – 2010, the consistent threshold autoregressive model is employed for the study considering the robustness and the limitations of other approaches. Results indicate that regional maize markets are integrated. Bidirectional market interdependence was found between market pairs both in the short and long run. The long run causality was however heterogeneous with respect to positive and negative shocks. The nature of price adjustment is asymmetric and traders respond quickly when market margins are squeezed than when stretched for all market pairs except between Brong Ahafo and Greater Accra market pairings. The time path needed for adjustment ranged from 7 to 26 months. The minimum adjustment time was 7 months occurring between Brong Ahafo - Greater Accra markets linkage for positive deviations and Brong Ahafo - Ashanti market for negative deviations. The recent expansion in communication infrastructure motivates the regional market integration. This implies that resources should be allocated to transportation development; the main hindrance to trade. The suboptimal condition of asymmetry is also motivated by inventory behaviour of traders but this remains a testable hypothesis. Traders in Greater Accra are slow in passing on price increases for the fear of loss of goodwill and/or loss of customer share given the multiple sources of supply

Innovating out of the Fishmeal Trap: The role of Insect-Based Fish Feed in Consumers’ Preferences for Fish Attributes

The purpose of the study was to examine the potential market impacts of the use of insect-based protein for fish feed as an innovative approach out of the fish-meal trap. An online questionnaire was used to elicit information on fish consumption choices among 610 German consumers using a Discrete Choice Experiment. Mixed logit and latent class logit models were used to model consumers’ preference heterogeneity. Results showed, that consumers’ preferences for fish attributes such as filets, freshness, ecolabelling and domestic production are heterogeneous and important in consumption choices. The minor share of the respondents was sensitive, while the remaining was indifferent regarding the use of insect based protein as feed in trout production. For this sensitive segment, consumption would be expected to be reduced unless the price is reduced or other attributes such as convenience aspects are improved. The implication is that firms can substitute without a significant impact on the market demand given that the majority of consumers are indifferent regarding feed sources for trout production. As a result, it provides an innovative way to ensure sustainable use of resources and reduces the threat of fish meal trap while reducing pressure on the already over-exploited marine life. The results provide first insights into the market impact of using insects in the animal protein value chain. It is important especially with Europe’s recent lift of the ban on using insect-based protein in the animal food industry

Market Conditions for Organic Aquaculture - Market and Price Analysis. RobustFish work package 6.2 report.

Organic aquaculture production is attaining impressive growth and demand is strongest in Europe. Countries like Germany, France and Switzerland particularly have stronger consumption markets. In 2010, the European Union implemented a harmonized system of organic aquaculture production principles for all member states. The regulation requires that fish production should exclusively be based on organic fry from 2016. Given that antibiotic use is only allowed in very strict limits, robustness of the fry to diseases is very crucial, particularly for countries like Denmark where serious trout fry diseases are a major concern. In spite of this, Denmark is making headway in organic aquaculture production, currently being the leading supplier of organic rainbow trout where Germany is the number one major market, consuming about 90% Danish trout production. The focus of this working package was to provide knowledge about the market conditions, consumer attitudes and preferences and the competitive effect of increased production that could result in strengthening the development of Danish organic trout production. Given that the organic trout is not a very established market, we extent the analysis to other organic aquaculture products, particularly salmon in order to map out what could be the case for trout. Lessons from major markets like Germany are also drawn given that the Danish market is relatively small. The analyses are conducted on two foundations; a descriptive statistics and review of the value chain, farm economic performance and identification of price premia for ecolabeled desktop review; and a science based analyses based on Danish and German markets. A number of interesting issues emerge and the following conclusions are reached: • There is unprecedented growth in the organic aquaculture industry, new product lines are emerging, stakeholders in the value chain have increased; processors have increased their supply portfolio to include organic fish products, distribution outlets are also expanding and include supermarket chains, catering services, restaurants and online shop operators. Hence, the value chain follows that of the conventional aquaculture products. • Producers of organic aquaculture are economically performing well, particularly for the case of portion sized rainbow trout in Denmark. The organic farms are at least equal to conventional trout and organic agricultural farms in terms of generating income per unit value of assets (8% per unit value of assets) and have a lower probability of default (28% solvency rate). • On the demand side, a review shows organic aquaculture products (mainly salmon) command price premia (24%-38%) which is higher than ecolabels in the capture fisheries (10%-13%) based on actual market data. These premia is within the range of organic agricultural food products. Generally, consumers are more sensitive to price changes of organic products. • A price premium of 20% was identified for organic salmon in the Danish retail market. This is a premium over both conventional farmed and wild (ecolabeled) salmon. The identification of a premium signifies that; consumers recognize and value the product; and that there is also trust in the Danish organic ecolabel which is widely known among consumers. For product development, the value (decreasing order) of fresh, marinated and smoked products attract premium over frozen products, brand labels are valued higher than private labels. • In a survey in Germany, consumers show high preference for organic produced portion size trout while seeing the ASC ecolabel to be equivalent to the conventional. However, the greatest value is placed on local German farmed trout, followed by Denmark relative to Turkey trout. Further evidence shows that in the event of campaigns to increase the perceive value of organic trout which eventually determines the market price, stronger emphasis should be placed on attributing organic principles such as GMO, hormones and synthetic additives; antibiotics use; feed and stocking densities to animal health and welfare concerns than environmental issues. The second best is the combination of both. That’s because animal health and welfare has been shown to be linked to food safety and food hazard risks by consumers. For product development and value addition, filets have are valued higher than whole trout products; the more the processing (skin and bones removed), the higher the preference. Fresh products are however preferred over smoked and frozen trout. The point of sale (supermarkets or specialized shops make no difference) • At the farm levels, price premium for organic produced rainbow trout in Denmark (about 33%) appear to be constant over time. Hence, increased production of organic rainbow trout would not cause a fall in premia to the farmer. Organic trout prices are however, determined by prices of the conventional products. This indicates that farmers could be assured of safeguarding their investments in organic trout farms. At the retail level, the evidence shows that relative organic salmon prices are non-constant, meaning that premium tend to fluctuate above the conventional prices. This is due to the fact that salmon prices are globally volatile in nature. • Consumer demand for salmon in Denmark reveals that the market is segmented. There is about 50% chance of choosing ecolabeled salmon (organic + ecolabel wild fish combined). Though on average, there is a lower chance of buying organic salmon due to the high market prices, preference is heterogeneous and so there is a segment of the population (about 20-30%) with high preference for organic salmon. The relative smaller share might be due to the smaller share of organic in the total aquaculture market

Organic Salmon – Considered a Fisheries or Agricultural Product Among Consumers?

The year 2016 will be pivotal for organic aquaculture producers in EU, because it represents the deadline for implementing the complete organic life cycle in aquaculture production. Depending on the sturdiness of farms already producing, such a shift in the industry may affect production costs of exclusively using organic fry for production. If the profitability of the primary organic aquaculture producers should be maintained, then farmers must be able to correspondingly receive higher prices, transmitted through the value chain from the retail market. This study identifies the price premium for organic salmon in Danish retail sale using consumer panel scanner data from households by applying a random effect hedonic price model that permits unobserved household heterogeneity. A price premium of 20% was identified for organic salmon. The magnitude of this premium is comparable to organic labeled agricultural products and higher than that of eco-labeled capture fishery products, such as theMarine Stewardship Council. This indicates that the organic label also used for agricultural products may be better known and trusted among consumers than the eco-labels on capture fishery product

Price premium of organic salmon in Danish retail sale

The year 2016 will be pivotal for organic aquaculture producers in EU, because it represents the deadline for implementing the complete organic life cycle in aquaculture production. Depending on the sturdiness of farms already producing, such a shift in the industry may affect production costs of exclusively using organic fry for production. If the profitability of the primary organic aquaculture producers should be maintained, then farmers must be able to correspondingly receive higher prices, transmitted through the value chain from the retail market. This study identifies the price premium for organic salmon in Danish retail sale using consumer panel scanner data from households by applying a random effect hedonic price model that permits unobserved household heterogeneity. A price premium of 20% was identified for organic salmon. The magnitude of this premium is comparable to organic labeled agricultural products and higher than that of eco-labeled capture fishery products, such as theMarine Stewardship Council. This indicates that the organic label also used for agricultural products may be better known and trusted among consumers than the eco-labels on capture fishery product

Exploring Perspectives of the Validity, Legitimacy and Acceptability of Environmental Valuation using Q Methodology

The extension of market systems and economic appraisal methods to the natural world and allocation of scarce resources is highly controversial and viewed by some as unethical. This has resulted in questions about the appropriate role of valuation and appraisal methods in informing policy and decision-making. We address this issue by assessing the different points of view that exist in marine research, management and policy communities regarding the estimation of monetary values for marine ecosystems and services and their use in appraisal and policy settings. The principal perspectives emerging from a Q-sort survey of x respondents reveal a clear distinction between a group that is highly sceptical of the framing of human-environment relations in terms of ecosystem services and of the use of economic appraisal and valuation tools in this context, and two or three other groups that are broadly favourable towards that paradigm and its methods, but with slightly different reasons for supporting valuation in practice. Despite the distinguishing features, areas of consensus emerge, including a strong shared perspective that places avoiding damage to marine biodiversity and ecosystems as a fundamental obligation. Furthermore, it is shown that the sceptics do not entirely reject valuation out of hand, but rather express understandable concerns about applicability and appropriate uses that are to some extent recognised by the pro-valuation groups

Capital structure and firm performance: Agencytheory application to Mediterranean aquaculturefirms

The study uses firm level panel data to determine perform-ance-leverage relationships among Mediterranean aquaculture production firms in Croatia, Italy, Spain, France and Greece. Astochastic frontier production function is used to determine and define performance through firm level efficiency estimates. The multilevel internal instrument variable approach is employed to identify the causal relation ships between performance and leverage. Our results show that technical efficiency has been increasing across all firms over the period 2008-2016. The agency-cost hypothesis holds such that leverage has an inverted U-shaped relationship with performance.This implies that leverage increases with efficiency, but efficiency begins to decrease at sufficiently higher levels of leverage. The reverse relationship confirms the franchise-value hypothesis, which states that firms with high efficiency will try to protect the value of their high income by holding more equity capital. Implications for the results are drawn for the Mediterranean region.The authors would like to thank the MedAID (Mediterranean Aquaculture Integrated Development) project, under which this research was conducted.The MedAID project has received funding from the European Union’s Horizon 2020 Research and Innovation Programme under grant agreement [no. 727315] (http://www.medaid-h2020.eu/)

Exploring Perspectives of the Validity, Legitimacy and Acceptability of Environmental Valuation using Q Methodology

The extension of market systems and economic appraisal methods to the natural world and allocation of scarce resources is highly controversial and viewed by some as unethical. This has resulted in questions about the appropriate role of valuation and appraisal methods in informing policy and decision-making. We address this issue by assessing the different points of view that exist in marine research, management and policy communities regarding the estimation of monetary values for marine ecosystems and services and their use in appraisal and policy settings. The principal perspectives emerging from a Q-sort survey of x respondents reveal a clear distinction between a group that is highly sceptical of the framing of human-environment relations in terms of ecosystem services and of the use of economic appraisal and valuation tools in this context, and two or three other groups that are broadly favourable towards that paradigm and its methods, but with slightly different reasons for supporting valuation in practice. Despite the distinguishing features, areas of consensus emerge, including a strong shared perspective that places avoiding damage to marine biodiversity and ecosystems as a fundamental obligation. Furthermore, it is shown that the sceptics do not entirely reject valuation out of hand, but rather express understandable concerns about applicability and appropriate uses that are to some extent recognised by the pro-valuation groups