The potential use of derivatives to manage the price risk of seafood markets: the case of sole and cuttlefish in France

Jean-Loïc Bégué-Turon, Yves Perraudeau and Nicolas Rautureau ()

MPRA Paper from University Library of Munich, Germany

Abstract: Taking into consideration the changes in the rules for the price support for agricultural and sea products, it seems appropriate to find out what other means could be used to cover the price risk in order to protect the commercial margin of these sectors of activity. The use of derivatives tools helps achieve this objective. We first emphasize the interest of such a study for fresh seafood markets and make a brief presentation of the various tools available to facilitate the understanding of future choices. Then we conduct a statistical analysis concerning the common sole and cuttlefish French markets which shows a good correlation level between sizes, presentations, qualities and the possibility to launch indices by species and OTC optional transactions on them. The last section brings into perspective the results and points out the various steps to take to make it functional.

Keywords: Cuttlefish; Derivative instruments; Price risk management; Sole (search for similar items in EconPapers)
JEL-codes: G19 O13 Q14 Q22 (search for similar items in EconPapers)
Date: 2006-10-04
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