Research Project

Traders in the food value chain - firm size and international food distribution

2014 - 2019 (Ongoing) Project number: 233836

The project focuses on patterns of distribution in Norway's seafood exports and agricultural trade (exports and imports).

The project examines organization, market structure and distribution along the value chains in international food trade, focusing on Norway's seafood exports and agricultural exports and imports. To what extent is the export success for salmon due to skilled traders? Does the organization of trade vary across seafood products, and which mode is more efficient? Is the organization of trade different for large and small firms? These are among the questions raised in this inter-disciplinary research project carried out by NUPI, SNF/Bergen and Ruralis/Trondheim, with international partners in the USA, UK and India. While the organization of seafood exports is studied by NUPI and SNF, Ruralis has undertaken case studies of Norwegian exports of differentiated goods. Do the firms have what it takes to export, or is distribution limited to the local markets? NUPI and SNF analyse Norwegian imports of agricultural goods: How is import organization and market structure affected by tariffs and quotas? How do the ever more stringent rules for food safety affect the organization of trade; are small firms able to handle this? Norway is a small country with peripheral location: Imports of e.g. flowers occurs indirectly via the Netherlands or Germany. What role do intermediaries play in trade? Through case studies and analysis of trade data we will find out how Norway differs from other countries: Are flower imports into the UK, or agricultural imports into Switzerland, organized differently from Norway? Imports from Asia are doubled in value on the way to Norway; is this true also for other European countries? In cooperation with customs authorities, we track trade for selected goods, to develop new tools for control and analysis. A reference group with key seafood and agriculture firms also contributes in the project.

With the approval of the Research Council, the project period was extended until the end of 2019, because NUPI's postdoc project was delayed for health reasons. The project had good progress in 2017-18; four additional journal articles (total by now 13) have been published, on top of numerous academic and popular presentations. About ten more articles are on their way. The project's unique data set for Norwegian foreign trade at the transaction level combined with extensive information about the firms has provided a platform for a number of interesting research contributions. On the user side we had cooperation with the Norwegian customs authorities about the use of mirror data (where e.g. the exports from China to Norway are compared to the corresponding imports into Norway from China) in their control activity. During the final year of the project, broader dissemination will be an important focus, in addition to academic publishing. The final conference will be arranged in May 2019. An important task during the final period will be to obtain more active participation from the reference group.

In the following, we provide some key words about some work in the project: Frank Asche has jointly with American colleagues in two articles analysed how aquaculture has transformed global seafood markets. The growth in aquaculture globally has led to higher seafood consumption and stimulated larger scale, modern logistics and new approaches to marketing. Hege Medin has, using Norwegian trade data, shown that the large majority of exporters and importers use customs brokers for the clearing of their goods. Small firms rarely have the capacity to declare the goods by themselves. In another article published in the project, Medin shows theoretically and empirically that the share of firms that are exporters, tends to be larger in small countries.

Jostein Vik and Gunn-Turi Kvam have in two articles published during the last year analysed agriculture-based Norwegian exports, where producers often cooperate with traders in order to obtain market access. In their contributions, the authors analyse how export is organised and its potential.

In various contributions, Hans-Martin Straume, Frank Asche and Erling Vårdal have analysed seafood exports at the firm level, and whether changes in trade are driven by firm exit or entry, or changes in sales for firms that are already in the markets. One article shows that transport costs have a stronger impact on trade than what has been expected from earlier research. Another recently published article shows that in cod exports of, the trade relations between exporters and importers are of short duration, and this volatility is high for seafood exports.

The international participants have contributed new insight on food trade in developing countries: Flower trade in developing countries and the UK (Jodie Keane, ODI), the fisheries sector in India (Meenakshi Rajeev, ISEC), and the meat exports of Botswana/Namibia including trade with Norway (Ben Bennett, NRI/Univ. of Greenwich and Karl Rich, Lincoln University/CGIAR).

Publications

Anderson, J. L., F., Asche. T. Garlock and J. Chu, 2017, Aquaculture: Its Role in the Future of Food World  Agricultural Resources and Food Security, pp. 159-173 in A. Schmitz , P. L. Kennedy & T. G. Schmitz (Eds.), World Agricultural Resources and Food Security: International Food Security, Frontiers of Economics and Globalization Volume 17, Emerald Publishing Limited.

Asche & T. Garlock, 2018, Globalization and Commoditization: The Transformation of the Seafood  Market,  Journal of Commodity Markets 12: 2-8.

Asche F., C. Roheim & M. D. Smith, 2016, Trade Intervention: Not a Silver Bullet to Address Environmental Externalities in Global Aquaculture, 69: 194-201, Marine Policy, ISBN 0308-597X.

Straume, Hans-Martin, 2017, Here today gone  tomorrow: the duration of Norwegian Salmon Export, Aquaculture Economics and Management 21(1), s. 88- 104. Doi: 10.1080/13657305.2017.1262477.

Straume, Hans-Martin & Erling Vårdal, 2015, The performance of large versus specialized firms: A study of firms  importing apples into Norway. Working Papers in Economics 07/15, University of Bergen, Department of Economics.

Medin, Hege, 2016, The reverse home-market effect in export. A cross-country study of the extensive margin of exports, Review of World Economics (Weltwirtschaftliches Archiv), 153(2):301-325.

Rajeev, Meenakshi and Bhandarkar, Supriya, 2016, A Study of Domestic Marketing Channels of Fisheries in Bangalore City (March 15, 2016). Social Science Research Network. Available at SSRN: https://ssrn.com/abstract=2747782.

Rajeev, Meenakshi & Supriya Bhandarkar, 2016, A Study of Domestic Marketing Channels of Fisheries in Bangalore City Social Science Research Network Page no. Issue/Volume/Year ISSN/ISBN

Medin, H. & P. B. Maurseth, 2016, Market-specific Sunk Export Costs: The Impact of Learning and Spillovers, The World Economy 40(6), July 2016. 

Straume, Hans-Martin, 2014, Currency Invoicing in Norwegian Salmon Export, Marine Resource Economics 29, no. 4 (December 2014): 391-409. https://doi.org/10.1086/678930.

Medin, H., 2017, Customs-brokers as facilitators in international trade. NUPI Working Paper No. 880, att https://www.nupi.no/en/Publications/CRIStin-Pub/Customs-brokers-as-facilitators-in-international-trade.

Rajeev, Meenakshi & Pranav Nagendran, 2018, Decency of primary occupations in the Indian fishing industry, Kassel University Press ICDD Working Papers 21/2018, ISBN: 978-3-7376-0452-9.

Asche, F., Cojocaru, A. L., Gaasland, I., & Straume, H. M., 2018, Cod stories: Trade dynamics and duration for Norwegian cod exports. Journal of Commodity Markets Volume 12, December 2018, Pages 71-79. ISSN: 2405-8513

Medin, Hege, 2015, Darwinistisk seleksjon i en global økonomi Magma - Tidsskrift for økonomi og  ledelse 18 (2015): 44-52.

Vik, Jostein &  Gunn-Turid Kvam, 2017, Governance and growth - A case study of Norwegian whey protein  concentrate exports. International Journal on Food System Dynamics 8/2017: 336-346,  ISSN/ISBN 1869-6945

Vik, Jostein &  Gunn-Turid Kvam, 2017, Trading Growth - A Study of the Governance of Norwegian Whey Protein Concentrate Exports, Proceedings in Food System Dynamics 8(4): 145-154 2017 ISSN/ISBN 2194-511X, http://centmapress.ilb.uni-bonn.de/ojs/index.php/fsd/article/view/846.

In the project, there have also been a large number of presentations in academic seminars/conferences but also for users in Norway and abroad.

Funders

Research Council of Norway

Funding program

BIONÆR