Nofima reports

Rapport/Report 23/2016 – English summary

Nyrud, Thomas; Bendiksen, Bjørn Inge; Dreyer, Bent Magne

Publication details

Publisher: Nofima AS

Issue: 23/2016

Number of pages: 24

International Standard Numbers:
Printed: 978-82-8296-388-6

Open Access: green

Links:
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FULLTEKST

This report looks at how large shifts in the exchange rate for Norwegian kroner has affected selected performance measures in the Norwegian seafood industry. Attention is directed towards two measures:
• The value of seafood exports measured in Norwegian kroner
• Profitability in the seafood industry
We develop an exchange rate index for seafood, and through studying this index conclude that the seafood industry historically has faced significantly larger exchange rate fluctuations than other export-oriented industries in Norway. Next, we analyze to what degree the total development in export value over a chosen period can be contributed to changes in either the exchange rate, export volume, or market prices/productmix.
We further show how high exchange rate volatility affects company profits, and discuss how the effects transfer throughout the value chain. We look at currency hedging instruments and how the use of these has affected the industry’s bottom line in periods of unstable currency markets. The report also discusses the connection between fluctuating currency prices and topics such as seasonality in fisheries, and foreign competition.