CORRECTED-UPDATE 1-Marine Harvest sees sharp fall in 2013 salmon volumes

Fri Oct 26, 2012 6:04am EDT

* Forecasts 10 pct decline in 2013 harvest

* Says will invest $139 mln in new feed unit

* Expects prices to start rising by end of Q4

* Shares down 5.6 pct (Corrects analyst quote in sixth paragraph to "Europe" from "the United States")

OSLO, Oct 26 (Reuters) - Marine Harvest, the world's biggest Atlantic salmon producer, on Friday forecast a sharp fall in 2013 volumes because it will have fewer live fish ready for slaughter.

Reporting third-quarter results, including the 84 percent drop in earnings flagged earlier this month, the company also said that it will invest 800 million Norwegian crowns ($139 million) in a new feed unit in Norway to keep production costs low in the face of rising feed prices.

Shares in the company were down 5.6 percent at 0851 GMT, against a 0.9 percent fall in the Oslo benchmark index.

Marine Harvest said that it expects the full-year harvest to be 390,000 tonnes of gutted weight, up a touch from an earlier forecast of 380,000 tonnes, but sees volumes falling to 350,000 tonnes in 2013.

Analysts polled by Reuters had on average expected 368,000 tonnes next year.

"The harvest guidance for 2013 is much lower than expected," said Kjetil Lye, analyst at Handelsbanken Markets, but added that this is likely to be offset by higher salmon prices, especially in Europe.

Low salmon prices as a result of a record increase in the global supply of Atlantic salmon have dented Marine Harvest's earnings this year, and its operations in Chile - the main producer of Atlantic salmon in the U.S. - and Canada reported third-quarter losses.

"While the supply growth in Europe seems to flatten out in 2013, there will still be significant growth in Chile," Marine Harvest said.

Prices may rise again towards the end of the year, at least in Europe, Chief Executive Alf-Helge Aarskog told a news conference.

"If supply and demand is at work, we will see an increase in Europe, but America will lag a few quarters," he said.

The company, controlled by shipping tycoon John Fredriksen, said that it is ready to take advantage of opportunities arising from the financial difficulties its rivals are likely to face at current price levels.

Marin Harvest's earnings before interest and taxes (EBIT) in the quarter to September 30 fell to 73 million Norwegian crowns from 457 million crowns a year ago.

Fourth-quarter volumes are expected to rise to 101,000 tonnes, from 93,229 tonnes in the third quarter.

The company reported preliminary third-quarter figures on Oct. 9. ($1 = 5.7686 Norwegian crowns)

(Reporting by Victoria Klesty and Ole Petter Skonnord; Additional reporting by Vegard Botterli; Editing by David Goodman)