POTENTIAL EFFECTS OF CLIMATE CHANGES ON THE PRICE VOLATILITY OF SMALL PELAGIC FISH  

Ruth Beatriz Mezzalira Pincinato*, Frank Asche
Postal address: University of Stavanger, Department of Industrial Economics, University of Stavanger, Ullandhaug, N-4036 Stavanger, Norway
Tel.: +47 45783601
E-mail address: ruth.b.pincinato@ uis.no

Small pelagics, an important source for fish meal, are a short-lived fish group highly depended on the oceanographic conditions. Therefore, potential climate changes may affect its fisheries current distribution. Small pelagics fisheries present high degree of uncertainty not only concerning the production, but also to the prices received for it. This will reflect directly on the gross revenue fisheries and, consequently will affect the aquaculture industry, particularly the feed prices. Considering prices as the outcome of the interaction of demand and supply, then price volatility may be used as a proxy or indicative measure of price risks: the higher the volatility, the higher the risk. This paper gives some insights about the possible outcomes from climate changes for the small pelagic fisheries price volatility in the different climate regions in the globe.

Small-pelagic < 30 cm value and quantities by Large Marine Ecosystem (LME) from Pauly and Zeller (2015) were used to estimate yearly prices (value divided by quantities) from 1950 to 2010.  Each Large Marine Ecosystem was classified by climate region: tropical, temperate and sub-arctic region. Here we show that the price volatility for the small pelagic group in the sub-arctic region is the highest, followed by temperate and tropical regions (Fig. 1).

Some hypothesis concerning the economic uncertain in the small pelagic fisheries may be suggested. One hypothesis is that the changes in the stocks distribution follows the prediction of marine species may shift their latitudinal range in response to warming waters fisheries in polar regions may be perceived as less price risky than before, since may have more temperate regions characteristics. This may lead to a higher fishing pressure on the stocks towards polar regions. On the other hand, given the fish prices in the sub-polar regions as more volatile than temperate and tropical regions, in the long term they will become even more volatile. Therefore, higher the price uncertain associated to the fisheries.

Given the development of price volatility over time (Fig. 2), it may be suggested that a higher price volatility may be expected in the future.

Pauly, D., and D. Zeller. 2015. "Sea Around Us Concepts, Design and Data." www.seaaroundus.org (July 20, 2015).