Over the past decades, global markets for fish and fish products have changed considerably and continue to do so. This is a never ending and ongoing process in which operators along the fisheries value chain (fishers, fish farmers, traders, processors and retailers) are searching for new opportunities, reduced production costs and profitable investments in an increasingly internationalised business environment. New products and production methods, fragmentation and outsourcing of production processes, and changing value chains are characteristics of the ever evolving nature of global fish markets. The particularity about fisheries is that it is part of a global commons that demands regional and international co-operation to ensure that fish stocks are exploited in a sustainable and responsible way.

Over the past decades, global markets for fish and fish products have changed considerably and continue to do so. In search of new business opportunities, reduced production costs and profitable investments, fisheries operators along the value chain (harvesters, processors, distributors and retailers) have turned to opportunities located abroad. This has been made possible as markets have become closer and more integrated though the reduction or abolishment of barriers for trade, investment and services, and as information and transport technology have advanced. The fisheries sector has undergone steady “internationalisation” over past decades, driven principally by a quest for access to resources and raw material.

Globalisation in the harvesting sector takes place in many ways including through investing abroad in foreign countries, through bilateral fisheries arrangements and through fishing on the high seas. Globalisation in the harvesting sector is, to a large extent, driven by the need of fleets to secure access to fish. The more secure and the long term access is, the more willing an investor will be to invest in fishing opportunities abroad. Fishing companies may globalise their activities as harvesting opportunities arise and could also be an outcome diminished opportunities in domestic waters. Fisheries management and governance are of crucial importance in determining whether or not fleets venture into new fishing grounds. In this respect it is important to review domestic and international fisheries management arrangements and settings to ensure sustainable outcomes.

Companies in the aquaculture sector have pursued a globalisation strategy based on foreign direct investment in aquaculture installations abroad or through fragmenting parts of the farming process to other companies. Production and transport costs in salmon farming differ considerably across producing countries due to labour costs and distance to markets. Concentration is occurring in the aquaculture sector, both in production and in companies providing inputs, particularly in the feed compound business; there are important economies of scale in aquaculture production as modern aquaculture is capital and knowledge intensive. Access to raw material (fish for reduction to meal and oil) is a key consideration in this respect. However this aspect may be of decreasing importance as research into alternative feed compounds based on vegetable material starts bearing fruit. A key policy implementation issue is the provision of sustainable and responsible aquaculture practices in producing countries. The implementation of national aquaculture plans are in this respect particularly important in outlining a future vision for the sector.

Major fish processing companies are pursuing two parallel strategies. In order to secure access to raw material fish processing companies integrate backwards into harvesting and aquaculture (through acquisitions, establishment of subsidiaries or building strategic alliances). Processors also integrate forwards in the value chain through sales and branding in order to establish bargaining power in light of increasing concentration in the retail sector. Restrictions on market access (through tariffs for developed countries and sanitary/hygiene issue in particular for developing countries) and investment climates that encourage foreign direct investment are areas where policy gaps still remain.

The retail sector is becoming increasingly globalised and this is transforming food production and consumption. In fisheries, globalisation in the retail sector is changing the nature of procurement. The sector is characterised by powerful retailers at the consumer end of the value chain, industry consolidation, the growing strength of supermarket own-brands, and a rise in the number of private labels attached to standards. The key policy challenge facing governments is whether and how to respond to the increasing role of private standards in retailing.

As demonstrated in this study it is the closer economic integration of fisheries production chains and markets that has characterised the developments in the fisheries sector over recent decades. The major differences between the last decades and previous “rounds of globalisation” relate to the speed of change as facilitated by more fluid capital markets, access to information and other technologies, better and faster modes of transport, and the increasing interdependence between developed and developing markets, and the need for co-operative management arrangements.

There is no agreed point in time when globalisation began. Some economic historians have noted the importance of the first circumnavigation of the Earth in 1519-21, while others note that the Vikings between 900-1050 were active traders who travelled great distances. However, a common feature is the expansion of the world economy and convergence towards a uniform pattern of economy. Sometimes these trends were slow or interrupted for long periods of time due to war or political confrontation, but whatever the pace, economic interaction and integration continues.

This annex provides an overview of the four major markets for fish and fish products: groundfish, salmon, shrimp and tuna. These four markets (each of them make up a number of species that may, to some degree, have different end uses) are the principal markets in international trade in fish and fish products, and are also subject to foreign direct investment and fisheries access agreements (except for salmon).