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1 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Model-based analysis of the profitability of herring fishery Herring – An alternative to decreasing.

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Presentation on theme: "1 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Model-based analysis of the profitability of herring fishery Herring – An alternative to decreasing."— Presentation transcript:

1 1 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Model-based analysis of the profitability of herring fishery Herring – An alternative to decreasing Baltic cod quotas ? Rainer Klepper Rolf Lasch Institute of Marketanalysis and Agricultural Trade Policy Braunschweig, Germany

2 2 EAFE - Conference 18 - 20 April 2001 Salerno, Italy (1)Backround (2)1996 – 2001  Costs  Earnings  Inputs (3)Model Assumptions (4)Results  COD – HER  COD-TAC Reduction (5)Conclusion Content

3 3 EAFE - Conference 18 - 20 April 2001 Salerno, Italy (1)Backround (2)1996 – 2001  Costs  Earnings  Inputs (3)Model Assumptions (4)Results  COD – HER  COD-TAC Reduction (5)Conclusion Content

4 4 EAFE - Conference 18 - 20 April 2001 Salerno, Italy (1)Backround  FAIR – Project  TAC (COD)  HER < 15%  Market/Processing (2)1996 – 2001 (3)Model Assumptions (4)Results (5)Conclusion

5 5 EAFE - Conference 18 - 20 April 2001 Salerno, Italy (1)Backround (2)1996 – 2001  Costs  Earnings  Inputs (3)Model Assumptions (4)Results  COD – HER  COD-TAC Reduction (5)Conclusion

6 6 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Cost Items relative to Returns, 1996 - 2000

7 7 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Cost Items relative to Returns, 1996 - 2000

8 8 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Cost Items relative to Returns, 1996 - 2000

9 9 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Cost Items relative to Returns, 1996 - 2000 3 1 1 2 3 8 11 9 36 27 73 100 5 0 1 2 3 6 8 20 35 24 76 100 0 2 0255075100 Others Travel Provision Ice & Conserv. Insurance (fix) Nets & Gears Maint. & Repairs Fuel & Lub.oil Marketing Wages & Soc.Ins. "gross margin" Total costs Returns basic model units: kg DM hour trip month

10 10 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Catch Rates COD, fishing grounds, 1996

11 11 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Catch Rates COD, fishing grounds, 2001

12 12 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Catch Rates COD & HER, fishing grounds, 2001

13 13 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Fish Prices for COD in DM/kg, 1996 - 2001

14 14 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Fish Prices for COD & HER in DM/kg, 1996 - 2001

15 15 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Fish Prices for COD & HER in DM/kg, 1996 - 2001

16 16 EAFE - Conference 18 - 20 April 2001 Salerno, Italy (1)Backround (2)1996 – 2001  Costs  Earnings  Inputs (3)Model Assumptions (4)Results  COD – HER  COD-TAC Reduction (5)Conclusion

17 17 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Baseline Solution - Assumptions - SIM 2001 Assumptions (Constraints)Assumptions (Constraints) –TAC : 212 t COD, HER free / 26.5 m Vessel –seadays : 258 (incl. charging and recharging) –max. days /trip : 6 for COD, 2 for HER –market supply (one trip/month, except JUL) –basic unit (kg, DM, hour, trips, month) –deterministic model –MIP (mixed integer model), days Objective Function --> MAX ! Gross MarginObjective Function --> MAX ! Gross Margin (Proceeds – Variable Costs) (Proceeds – Variable Costs)

18 18 EAFE - Conference 18 - 20 April 2001 Salerno, Italy (1)Backround (2)1996 – 2001  Costs  Earnings  Inputs (3)Model Assumptions (4)Results  COD – HER  COD-TAC Reduction (5)Conclusion

19 19 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Baseline Solution - Results - SIM 2001 No Herring CatchNo Herring Catch –Proceeds [tDM] –Gross Margin [tDM] –Seadays –Number of trips –Catch total [t] –Catch composition COD [%]COD [%] FLX [%]FLX [%] HER [%]HER [%] Others [%]Others [%] absolute absolute 737 737 276 276 162 162 29 29 336 336 Catch Proceeds 62 %79 % 33 %16 % - - - - 5 % 5 % 5 % 5 % relative relative 100 %

20 20 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Baseline, COD and HER & COD – Quota Reduction

21 21 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Baseline, COD and HER & COD – Quota Reduction

22 22 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Baseline, COD and HER & COD – Quota Reduction

23 23 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Baseline, COD and HER & COD – Quota Reduction

24 24 EAFE - Conference 18 - 20 April 2001 Salerno, Italy COD – Quota Reduction / Future Developments ?HER 2001 ?HER Fish Price + ? % ?HER Catch Rate + ? % ?HER, COD Fish Price + ? % ?HER, COD Catch Rate + ? % ?no HER, COD Catch Rate+ ? % ?no HER, COD Fish Price+ ? % 94 % GM 94 % GM + 30 % + 30 % + 37 % + 37 % + 9 % + 9 % + 28 % + 28 % + 13 % + 13 %

25 25 EAFE - Conference 18 - 20 April 2001 Salerno, Italy COD – Quota Reduction / Future Developments ?HER 2001 ?HER Fish Price + ? % ?HER Catch Rate + ? % ?HER, COD Fish Price + ? % ?HER, COD Catch Rate + ? % ?no HER, COD Fish Price+ ? % ?Fuel oil Price - ? % 94 % GM 94 % GM + 30 % + 30 % + 37 % + 37 % + 9 % + 9 % + 28 % + 28 % + 13 % + 13 % - 70 % - 70 %

26 26 EAFE - Conference 18 - 20 April 2001 Salerno, Italy COD – Quota Reduction / Future Developments ?HER 2001 ?HER Fish Price + ? % ?HER Catch Rate + ? % ?HER, COD Fish Price + ? % ?HER, COD Catch Rate + ? % ?no HER, COD Fish Price+ ? % ?Fuel oil Price - ? % 94 % GM 94 % GM + 30 % + 30 % + 37 % + 37 % + 9 % + 9 % + 28 % + 28 % + 13 % + 13 % - 70 % - 70 %

27 27 EAFE - Conference 18 - 20 April 2001 Salerno, Italy COD – Quota Reduction / Future Developments

28 28 EAFE - Conference 18 - 20 April 2001 Salerno, Italy COD – Quota Reduction / Future Developments

29 29 EAFE - Conference 18 - 20 April 2001 Salerno, Italy (1)Backround (2)1996 – 2001  Costs  Earnings  Inputs (3)Model Assumptions (4)Results  COD – HER  COD-TAC Reduction (5)Conclusion

30 30 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Conclusion  HER no Alternative to COD (26.5 m vessels, active fishery)  additional income is very low  Globefish: „rising prices of small pelagics“ („reduced supply of Atlantic herring“)  further increase in COD prices

31 31 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Thank you for your attention Rainer Klepper Rolf Lasch Institute of Marketanalysis and Agricultural Trade Policy Braunschweig, Germany

32 32 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Fish Prices for COD & HER in DM/kg, 1996 - 2000

33 33 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Cost items relative to Returns (=100), 1996 - 2000 36,3% 1,2% 8,7% 10,6% 7,5% 2,7% 0,9% 1,6% 3,4% 72,9% 27,1% 34,8% 1,6% 0,1% 19,9% 7,9% 6,3% 2,9% 1,3% 2,1% 5,3% 76,4% 23,6% 0%30%60% Wages & Soc.Ins. Provision Travel Marketing Fuel & Lub.oil Maint. & Repairs Nets & Gears Ice & Conserv. Insurance (fix) Others Total costs "gross margin" 1996 2000

34 34 EAFE - Conference 18 - 20 April 2001 Salerno, Italy Contents (1)Backround (2)1996 – 2000  Costs, Earnings, Inputs (3)Model Assumptions (4)Results  COD – HER  COD - Quota Reduction

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