Fish Is Food - The FAO’s Fish Price Index

Sigbjørn Tveterås,Audun Lem,Kristin Lien,Martin D Smith,Stefania Vannuccini,Marc F Bellemare,Frank Asche,Atle G Guttormsen,Alejandro Raul Hernandez Montoya

doi:10.1371/journal.pone.0036731

Abstract

World food prices hit an all-time high in February 2011 and are still almost two and a half times those of 2000. Although three billion people worldwide use seafood as a key source of animal protein, the Food and Agriculture Organization (FAO) of the United Nations–which compiles prices for other major food categories–has not tracked seafood prices. We fill this gap by developing an index of global seafood prices that can help to understand food crises and may assist in averting them. The fish price index (FPI) relies on trade statistics because seafood is heavily traded internationally, exposing non-traded seafood to price competition from imports and exports. Easily updated trade data can thus proxy for domestic seafood prices that are difficult to observe in many regions and costly to update with global coverage. Calculations of the extent of price competition in different countries support the plausibility of reliance on trade data. Overall, the FPI shows less volatility and fewer price spikes than other food price indices including oils, cereals, and dairy. The FPI generally reflects seafood scarcity, but it can also be separated into indices by production technology, fish species, or region. Splitting FPI into capture fisheries and aquaculture suggests increased scarcity of capture fishery resources in recent years, but also growth in aquaculture that is keeping pace with demand. Regionally, seafood price volatility varies, and some prices are negatively correlated. These patterns hint that regional supply shocks are consequential for seafood prices in spite of the high degree of seafood tradability.

Highlights

The food crises of 2007–2008 and 2010–2011 demonstrated that sharp increases in food prices can have dire consequences for the poor in developing countries
While the arguments above justify the reliance on trade data in general for the fish price index (FPI), here we argue that the particular choice of data from the EU, US, and Japan is practical
The FPI we developed provides a new tool to understand global seafood markets and can be used to help inform global food policy

Summary

Introduction

The food crises of 2007–2008 and 2010–2011 demonstrated that sharp increases in food prices can have dire consequences for the poor in developing countries. The price of food hit an all-time high in February 2011, and the Food and Agriculture Organization (FAO) of the United Nations’ food price index is currently equal to two and a half its level in 2000 [3]. Some speculate that the current food crisis might have led to the 2011 uprisings in the Middle East and North Africa, as the price of food hit an all-time high in February 2011 [3,4]. Because high prices signal shortages in current and expected future food availability [5], tracking price developments is a major tool in understanding poverty and can be an important step in fighting poverty [6]. The historical and growing importance of seafood suggests that it is time for the international community to consider it as food in global food accounting

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Conclusion