Salmon prices on the rise The price of salmon is on an upward Worldwide, the price of fish feed is rising trend. Demand for the fish is growing as a result of more fish farming and as consumers worldwide have a limited catches of anchovies, an important 1. Using Figure 12, identify two greater appreciation of its health-giving significant features of the data source of fish feed. properties. Supply is struggling to keep shown. In your answer, back up your up with this trend. The weather too can impact on supply. In comments with data. 2013, Norway suffered colder than usual Almost all salmon sold today is farmed 2. Using supply curve diagrams, seawater which inhibited the growth salmon rather than wild salmon caught explain the effects on the supply of of salmon and so the total tonnage of salmon of the following described in in the sea or rivers. Rising prices have salmon produced fell. the artide: led to increased profits for salmon Source: adapted from @ the Financial Times (a) a change in profits by fish farmers. Norway Royal Salmon, for 15.3.2014, All Rights Reserved. farmers; example, reported its highest profits in its 21-year history in 2013. Evaluation )licences issued by governments Question 3 osks how easily the quantity to salmon farmers; However, despite the incentive of supplied of salmon can be changed in a change in fish feed prices; rising profits, there are factors which response to changes in its price. In your 'd) changes in the weather. are holding back the expansion of answer, write about the short term - if the price of salmon doubled today, for example, 3. Discuss whether the price elasticity the industry. In Norway, the largest producer of farmed salmon, production could the quantity supplied of salmon of supply of salmon is likely to be double in the next year? What are the high or low. by private firms is restricted by the constraints on increasing supply? Then government, which issues licences. consider the long term. What are the constraints on increasing supply and how There is also a limit on the number of important are they? Come to an overall salmon which can be farmed in one condusion about the short term and place because of the risk of disease. long term Figure 12 Figure 13 Salmon prices Total world salmon production Norwegian Krone per kg Million tonnes 60 - 2.5 - 60 - 2.0 Total world salmon production 1.5 30 1.0- 20 - 2008 09 10 11 12 13 2012 2013 2014 Source: adapted from Food and Agriculture Organization of the United Source: adapted from Thomson Reuters Dotostream; @ the Financial Times Notions, GLOBEFISH HIGHLIGHTS, January-Sept 2014, 31.1.2015, Rome, Itoly 15.3.2014, All Rights Reserved. Reproduced with permission