Salmon trout, the forgotten cousin?

Abstract

This study investigates potential economic reasons why the production of trout is maintained in Norway by analyzing prices and production for Norwegian Atlantic salmon and trout. The species Atlantic salmon dominates the global salmon market, but its two largest producers, Norway and Chile also farm in sea pens significant quantities of large rainbow trout (as opposed to portion-sized Rainbow trout farmed in freshwaters in other parts of the World, e.g., Iran, Peru, Turkey, and others). Suggesting that these trout have some attributes that make it a useful complement to Atlantic salmon. We investigate development in supply volumes of these species and conduct a cointegration analysis using monthly prices from 2000 to 2018. The results show that the markets for fresh and frozen rainbow trout are tightly integrated with fresh Atlantic salmon, and, where the latter is a price leader. This means that many consumers consider the two products as substitutes, with no clear preferences. There is no apparent productivity argument for the continued production of rainbow trout vis-à-vis Atlantic salmon. However, there may exist a fringe of consumers that prefer its characteristics, motivating firms to maintain its production as a means of diversification.

Keywords:

• Aquaculture
• salmon
• trout

Notes

1 Portion sized trout is harvested at between 0.5 kg and 1 kg and are referred to as portion sized since it tends to be cooked whole.

2 We do not have data to directly assess growth performance, feeding efficiency or other factors that may impact production. The results of Weihe et al. (2019) indicate that even feeding strategy may matter.

3 In the 1980s, Finland also produced portion sized trout, but this is excluded here based on estimates from Kontali Analyse. Portion sized trout is the largest aquaculture species in a number of European countries (Guillen et al., 2019; Llorente et al., 2020).

4 Salmon trout is regulated together with salmon in Norway, and producers are free to choose which of the species to produce (Asche & Bjørndal, 2011). Hence, there are no regulatory advantages associated with the production of salmon trout, and there do not appear to be any environmental advantages either (Abate et al., 2018; Nielsen, 2011; Torrissen et al., 2011; Tveterås, 2002).

5 The Directorate of Fisheries does not break down their production cost data by species, and there is accordingly no information available with respect to the production cost for trout relatively to salmon. However, this do suggest together with the common price development that the same factors that has led to productivity growth for aquaculture in general and salmon in particular (Anderson et al., 2019; Asche, 2008; Kumar & Engle, 2016) also have impacted salmon trout.

6 There is a rapidly increasing literature on sustainable seafood indicating that producers with production labeled to be sustainable obtains a price premium that has an increasing impact also on aquaculture (Osmundsen, Amundsen, et al., 2020; Osmundsen, Olsen, et al., 2020; Roheim et al., 2018; Sogn-Grundvåg et al., 2019; Tlusty et al., 2019). Alfnes et al. (2018) indicate that there are 48 different sustainability labels in use for salmon, and Bronnmann and Asche (2017) show that the generally negative consumer perception of farmed fish relatively to wild can be made up with an ecolabel. However, salmon trout has received little attention in the respect, and this does not seem to be a potential explanation for the limited premium. Asche, Larsen, et al. (2015) and Ankamah-Yeboah et al. (2016, 2020) show that there a significant premium associated with organic labeled salmon, a fish that is significantly more expensive to produce, suggesting that the moderate premium may be associated with higher production costs.

7 This also implies that the Fishpool exchange (Asche et al., 2016; Misund & Asche, 2016; Ankamah-Yeboah et al., 2017; Oglend & Straume, 2020) can be used equally well for salmon trout as for salmon. It is also worthwhile to note that while fish price volatility in general is high (Asche et al., 2019; Asche, Dahl, et al., 2015; Dahl & Oglend, 2014), salmon and thereby by implication salmon trout are among the less volatile fish prices. A consequence is also that salmon trout production has most likely been as profitable on a per unit basis as salmon (Misund & Nygård, 2018).

8 The seasonality is still moderate compared to what is the case in most fisheries as descrbed in the case of Norwegian fisheries by e.g., Bertheussen and Dreyer (2019) and Birkenbach et al. (2020). This is most likely also causing aquaculture to have lower production risk than fisheries (Asche et al., 2020).