An analysis of the management and economics of salmon aquaculture

• Main Author: Liu, Yajie
• Language: en
• Published: University of British Columbia 2008
• Subjects: salmon aquaculture; economics; environmental impacts; sea lice; pollution; policy implications and recommendations
• Online Access: http://hdl.handle.net/2429/323

Salmon aquaculture can be a potential solution to bridge the gap between declining capture fisheries and increasing seafood demand. However, the environmental impacts it creates have generated criticism. The overall objectives of this dissertation are to examine the economic consequences of environmental issues associated with salmon aquaculture, and to explore policy implications and recommendations for reducing environmental impacts. These objectives are addressed in five main analyses. The growth of salmon aquaculture is analyzed based on farmed salmon production in the four leading producing countries and the sector as a whole. Analyses indicate that salmon aquaculture is unlikely to continue to grow at its current pace. A joint production function approach is used to estimate pollution abatement costs for the salmon aquaculture industry. Results reveal that pollution abatement costs vary among observations and models. On average, pollution abatement cost is estimated at 3.5% in terms of total farmed salmon production, and 6.5% in terms of total revenue of farmed salmon. The ecological and economic impacts of sea lice from salmon farms on wild salmon population and fisheries are also studied. Analyses suggest that these effects are minor when the sea lice induced mortality rate is below 20%, while they can be severe if the mortality is greater than 30%. Sea lice have greater ecological and economic impacts on pink salmon than on chum salmon. These effects are greater under a fixed exploitation rate than under a target escapement policy. The economic performance of open netcage and sea-bag production systems for salmon aquaculture is compared. Netcage systems appear to be more economically profitable than sea-bag systems when environmental costs are either not or only partially included. Sea-bag systems can be financially profitable only when the salmon they produce can achieve a price premium. Finally, policy implications are explored and recommendations are made for sustaining salmon aquaculture in a holistic manner based on the results from previous chapters. Technologies, economic-based instruments and more stringent environmental policies can be employed to reduce environmental impacts. However, there is no single solution to solve these environmental impacts, and a combination of policy options is needed.