Climate Risk in Norwegian Aquaculture

Abstract

Climate change poses significant challenges on a global scale, and financial impacts could be caused both directly through natural disaster and indirectly through a transition to a lower- carbon economy. Climate change and global initiative force adjustments, which makes climate-related risks and opportunities applicable to all sectors and industries. This highlights the importance of incorporating risk assessment, and risk management into companies’ long- term strategies to reduce risks.

This thesis aims to improve the understanding of how climate risks and opportunities affect the Norwegian aquaculture sector. More specifically we utilize the Task Force on Climate- related Financial Disclosure’s framework to identify climate-related risks and opportunities. Previously written literature and microeconomic models combined with value chain methodology enable us to anticipate the implications for the sector.

Our findings suggest that transition risks are the most critical in the short- to medium term. They include expected policy changes, and regulations surrounding feed scarcity and sustainability. Price sensitivity of raw materials due to their large share of total costs combined with the vulnerability to climate risk indicate that the feed-market is the primary concern for sustainable development. Further we find that physical climate risks may become a challenge in the long run, however the implications are hard to estimate. Opportunities are mainly presented through future growth potentials, and collaboration within the sector.