Market conditions for organic aquaculture: market and price analysis RobustFish work package 6.2 report Isaac Ankamah-Yeboah Max Nielsen Rasmus Nielsen 259 IFRO Report 259 Market conditions for organic aquaculture: market and price analysis. RobustFish work package 6.2 report Authors: Isaac Ankamah-Yeboah*, Max Nielsen, Rasmus Nielsen *Corresponding author contacts: Email: [email protected] Tel: +45 35 33 37 55 Published June 2017 ISBN: 978-87-92591-80-7 This report is made as work under the RobustFish project. RobustFish is part of the Organic RDD 2 programme, which is coordinated by the International Centre for Research in Organic Food Systems (ICROFS). It has received grants from the Green Growth and Development programme (GUDP) under the Danish Ministry of Food, Agriculture and Fisheries (J.nr.: 34009-13-0677). IFRO Report is a continuation of the series FOI Report that was published by the Institute of Food and Resource Economics. The report series can be found here: http://ifro.ku.dk/publikationer/ifro_serier/rapporter/ Department of Food and Resource Economics University of Copenhagen Rolighedsvej 25 DK 1958 Frederiksberg www.ifro.ku.dk/english Table of contents SUMMARY ................................................................................................................................................................3 CHAPTER 1 ................................................................................................................................................................6 INTRODUCTION ........................................................................................................................................................6 CHAPTER 2 ................................................................................................................................................................8 THE VALUE CHAIN, FARM ECONOMIC PERFORMANCE AND PRICE PREMIA ...........................................................8 2.1 Value chain description for organic aquaculture: Denmark and Germany ....................................................8 2.1.1 Introduction .............................................................................................................................................8 2.1.2 Statistics in Germany ...............................................................................................................................9 2.1.3 Statistics in Denmark ............................................................................................................................ 10 2.2 Financial performance of the Danish organic trout aquaculture ................................................................ 13 2.2.1 Introduction .......................................................................................................................................... 13 2.2.2 Overview of the aquaculture sector ..................................................................................................... 13 2.2.3 Data source and methods .................................................................................................................... 14 2.2.4 Output and financial performance of organic trout compared to other farms ................................... 14 2.3 Comparison of seafood and agricultural ecological premiums ................................................................... 18 2.3.1 Introduction .......................................................................................................................................... 18 2.3.2 Methods ............................................................................................................................................... 20 2.3.3 Empirical evidences of ecological price premiums ............................................................................... 20 CHAPTER 3 ............................................................................................................................................................. 29 PRICE PREMIUM OF ORGANIC SALMON IN DANISH RETAIL SALE ......................................................................... 29 3.1 Introduction ................................................................................................................................................. 29 3.2 The Danish seafood market ......................................................................................................................... 31 3.3 Data ............................................................................................................................................................. 32 3.4 The hedonic price model ............................................................................................................................. 34 3.5 Empirical model specification ...................................................................................................................... 35 3.6 Estimation results ........................................................................................................................................ 37 3.7 Conclusion ................................................................................................................................................... 40 CHAPTER 4 ............................................................................................................................................................. 42 HETEROGENEOUS PREFERENCES, INFORMATION, AND KNOWLEDGE FOR ORGANIC FISH DEMAND ................. 42 1 4.1 Introduction ................................................................................................................................................. 42 4.2 Methodology ............................................................................................................................................... 44 4.2.1 Choice experiment design and data collection .................................................................................... 44 4.2.2 Discrete choice modeling: generalized mixed multinomial logit ......................................................... 47 4.3 Results and discussion ................................................................................................................................. 48 4.4 Conclusion ................................................................................................................................................... 53 CHAPTER 5 ............................................................................................................................................................. 54 DOES ORGANIC SUPPLY GROWTH LEADS TO REDUCED PRICE PREMIUMS? THE CASE OF SALMONIDS IN DENMARK .............................................................................................................................................................. 54 5.1 Introduction ................................................................................................................................................. 54 5.2 The Danish market for salmonids ................................................................................................................ 55 5.3 Methodology ............................................................................................................................................... 57 5.4 Data ............................................................................................................................................................. 59 5.5 Results ......................................................................................................................................................... 60 5.6 Conclusion ................................................................................................................................................... 65 CHAPTER 6 ............................................................................................................................................................. 66 CONSUMER PREFERENCES FOR FARMED ORGANIC SALMON AND ECO-LABELLED WILD SALMON IN DENMARK ............................................................................................................................................................................... 66 6.1 Introduction ................................................................................................................................................. 66 6.2 Data description .......................................................................................................................................... 67 6.3 Model specification ..................................................................................................................................... 70 6.4 Estimation results and discussion ................................................................................................................ 71 6.5 Conclusion ................................................................................................................................................... 75 CHAPTER 7 ............................................................................................................................................................. 76 CONCLUSION ......................................................................................................................................................... 76 REFERENCES .........................................................................................................................................................