SUCCESS Strategic Use of Competitiveness towards Consolidating the Economic Sustainability of the european Seafood sector
SUCCESSStrategic Use of Competitiveness towards Consolidating the Economic Sustainability of the european Seafood sector 

Demand - Salmonid case study

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This section presents the results of the models analysis.

 

The specie used to represent the salmonid case study is salmon, a global commodity widely consumed all around the world and Europe.

 

The countries studied in this analysis are Spain, France, Italy, the UK and Germany. Poland, Greece and the Netherlands, including the most relevant markets in the EU in total seafood and at the species level.

Context

Products

Most the quantities of salmon consumed in the EU are of farmed fish, harvested mainly in Norway and Scotland. Salmon is a well-diversified commodity which is traded fresh, frozen and smoked including whole fish fillets and more elaborated processed products.

 

Consumption

The UK and France are the two countries with the highest rates of consumption, followed by the Netherlands, Spain and Germany. Greece, Italy and Poland, on the opposite, record the lowest levels of consumption per person. Salmon consumption has increased in all the observed countries, but especially in those with the lowest consumption rates showing an impressive power of penetration and growth.

Evolution of per caput consumption (kg) of salmon by countries

ES = Spain                               FR= France                              IT=Italy                                          DE=Germany            UK=United Kingdom                 PL=Poland                               GR=Greece                                NL= Netherlands

Effect of price, income and population on salmon’s demand by countries

France, Germany, United-Kingdom

In contrast of cod consumption, salmon is mostly driven by changes in the population size in these countries. In this sense, salmon consumption is increasing since supply is increasing in the market, absorbing the growing production of the last decades and allowing both the entrance of new consumers and the raise of the consumption in existing consumers.

However, the role of the economic variables is still relevant. Salmon is also a superior good which consumption increases at the time of the income, and is also price elastic. In this case, income elasticity is stronger than price elasticity and the direct effect of a raise on income compensates the effect of a raise in the prices.

 

Italy

Same results as the previous countries. Moreover, on the contrary of the previous countries, an increase of income leads to an increase of price, which have an indirect effect on salmon demand.

 

Greece

Same results as France, Germany and United-Kingdom. However, the models used allow explaining only 64% of the demand variation: other parameters that are not studied here have an important influence on the demand.

 

Spain

Population appears to be the main drivers in salmon demand changes. Demand seems to be price elastic but this tendency is less powerful than population effect.

 

Poland

On the contrary of the others countries, salmon consumption is driven by economic parameters only. The increase of population size doesn’t lead to an increase of consumption. Price doesn’t seem to influence salmon consumption, but an increase of income lead to an increase of consumption.

 

Netherlands

On the contrary of the others countries, salmon consumption is driven by economic parameters only. The increase of population size doesn’t lead to an increase of consumption, which may reflect the slow increase of consumption in the observed period. Income is positively related to consumption, while prices are exerting a negative effect.

However, the models used allow explaining only 55% of the demand variation: other parameters that are not studied here have an important influence on the demand.

Conclusion

The consumption is mostly driven by changes in the population size and less dependent on economic variables. In this sense, salmon consumption is increasing since supply is increasing in the market, allowing both the entrance of new consumers and the raise of the consumption in existing consumers. However, the role of the economic variables is still relevant. Salmon is also a superior good which consumption increases at the time of the income, and is also price elastic. In this case, income elasticity is stronger than price elasticity and the direct effect of a raise on income compensates the effect of a raise in the prices.

 

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SUCCESS is a H2020 Research and Innovation Project (2015-2018)

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“This project has received funding from the European Union’s Horizon 2020 research and innovation programme under grant agreement No 635188”