From feed to fish: The impact of input factor and uncertainty shocks in Bangladesh aquaculture market

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Aquaculture plays a crucial role in ensuring food and nutritional security in Bangladesh. This study employs a Bayesian Vector Autoregression model to investigate the pass-through effects of feed prices and economic uncertainty shocks on tilapia and pangasius markets. The findings reveal that both tilapia and pangasius exhibit the characteristics of mature commodities but experience a short delay in pass-through effect from feed price shocks. This delay may occur due to production cycles, scale of operations, contractual arrangements, and asymmetry in information flow along the vertical value chain. However, pangasius price demonstrates faster and stronger responses compared to tilapia. Although economic uncertainty exerts downward pressure on fish prices, it may bring adverse effects to both producers’ and consumers’ welfare. Forecast analysis indicates an upward price trajectory for both fish species that are likely to have spillover effects on other aquaculture markets. The findings of this study can be applicable to neighboring South Asian countries with similar aquaculture market structures.