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Market integration of domestic and imported seafood: Insights from the Sydney Fish Market*

Market integration of domestic and imported seafood: Insights from the Sydney Fish Market* Australia has experienced a significant increase in seafood imports over the past two decades. Concurrently, Australian seafood producers have raised concerns that the low market prices of imported fish may negatively affect the prices of domestically produced seafood and, subsequently, the profitability of the Australian fishing industries. To validate this concern, this study examines the relationship between prices of domestically produced seafood and imported fish. Price data from the Sydney Fish Market (SFM), Australia’s largest auction wholesale fish market and fish import data are used for a cointegration analysis which is conducted using the bivariate Johansen test. Results indicate that prices of most domestic species traded within the SFM are not cointegrated, implying that they largely develop independently of each other. However, imported fish, particularly fresh imports, were found to be cointegrated with Australian produced fresh fish supplies traded on the SFM. Although the law of one price (LOP) was only confirmed to hold for some price pairs, the results suggest a partial substitution relationship between imports and domestically caught fish. This implies that prices of domestically produced fish within the Australian market are likely impacted by price dynamics within the international seafood market. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png The Australian Journal of Agricultural Resource Economics Wiley

Market integration of domestic and imported seafood: Insights from the Sydney Fish Market*

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References (43)

Publisher
Wiley
Copyright
Copyright © 2022 Australian Agricultural and Resource Economics Society Inc.
ISSN
1364-985X
eISSN
1467-8489
DOI
10.1111/1467-8489.12452
Publisher site
See Article on Publisher Site

Abstract

Australia has experienced a significant increase in seafood imports over the past two decades. Concurrently, Australian seafood producers have raised concerns that the low market prices of imported fish may negatively affect the prices of domestically produced seafood and, subsequently, the profitability of the Australian fishing industries. To validate this concern, this study examines the relationship between prices of domestically produced seafood and imported fish. Price data from the Sydney Fish Market (SFM), Australia’s largest auction wholesale fish market and fish import data are used for a cointegration analysis which is conducted using the bivariate Johansen test. Results indicate that prices of most domestic species traded within the SFM are not cointegrated, implying that they largely develop independently of each other. However, imported fish, particularly fresh imports, were found to be cointegrated with Australian produced fresh fish supplies traded on the SFM. Although the law of one price (LOP) was only confirmed to hold for some price pairs, the results suggest a partial substitution relationship between imports and domestically caught fish. This implies that prices of domestically produced fish within the Australian market are likely impacted by price dynamics within the international seafood market.

Journal

The Australian Journal of Agricultural Resource EconomicsWiley

Published: Jan 1, 2022

Keywords: Australia; cointegration; fish; imports; Law of One Price; seafood

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