Somali pirates have been much in the news recently with their high profile captures of oil tankers and other ships. The impact on shipping in the area is clear and this has disrupted trade in the region, but an unforeseen impact has been on the total worldwide catch of tuna. The Indian Ocean is one of the richest sources of tuna in the world and the pirate activity has led to a fall of around 30% in the total tuna catch.
Somali piracy ‘reduces tuna haul’ BBC News Online (22/1/09)
- Using diagrams as appropriate, show the impact of Somali pirate activity on the market for tuna.
- Suggest likely values for the price elasticity of demand and supply of tuna. Analyse the extent to which these values are likely to affect the price rise in the market for tuna.
- What substitutes are available for tuna? Assess the extent to which the availability of substitutes will affect the rise in the price of tuna.