Price and quality in the ex-vessel market for whitefish

Summary

It is a common understanding whitefish industry that there is little connection between quality and price for fresh cod (and other fish species) landed by the coastal fleet. In this project, we have linked measurements of quality of landings to to gear, catch size, fish size, annual catch and used the dataset in a hedonic price model. By expanding the model, we have also been able to test the significance of catch size regardless of gear and how quality affects buyers' pricing. When other factors are kept constant, quality does not affect price within gear groups. Large catches achieve a higher price and there is a price difference between gear where cod caught on gillnet are paid the least, followed by jigging (+ 8.2%), Danish seine (11.6%) and long-line (12.2%). The findings indicate that the market for fresh cod from the coastal fleet deviates from idealized models and that it works poorly in relation to quality-based pricing. There may be several reasons why the market does not function, such as: Asymmetric information in a situation of time pressure, subjective assessment of quality, compensation for poor quality with "big hundred" and that quantity is prioritized over quality. Industry and authorities can use this knowledge to either make moves to make the market work so that quality is rewarded. Alternatively, adjustments can be made to the catch operation and catch treatment with the same purpose.