January 12, 2018 / 1:02 PM / 4 months ago

Price of Norwegian farmed salmon drops below NOK 50/kilo

OSLO, Jan 12 (Reuters) - The price of Norway’s farmed salmon is expected to fall below 50 Norwegian crowns per kilo next week for deliveries in Oslo, from 53-54 crowns in the current week, industry sources told Reuters on Friday.

“It’s difficult to predict prices but it’s certainly down and below 50 crowns,” said a producer who declined to be named.

He added that a price drop is a normal seasonal pattern after the Christmas holidays and that the market could possible tighten again towards the end of January.

An exporter confirmed prices were falling and was even more pessimistic.

“It’s bad. We are down 6 crowns to an average of around 48-49 crowns per kilo in Oslo,” the exporter said.

“What happens now scares me a little because the drop is not caused by higher volumes but low demand. I believe we could see 40 crowns pretty soon,” he added.

Salmon prices peaked at around 80 crowns per kilo in early January of 2017 at a time when supply constraints supported prices, but have since fallen as volumes grew.

Norway is the world’s top salmon exporter, and the share price of listed farming companies depends heavily on changes in the price of fish.

Average production costs for whole fish, including the cost of harvesting, rose by 13 percent to 34.29 crowns per kilo in 2016, according to data from the Norwegian Directorate of Fisheries.

Leading Norwegian producers include Marine Harvest, Salmar, Leroy Seafood, Grieg Seafood and Norway Royal Salmon. (Reporting by Ole Petter Skonnord, editing by Terje Solsvik)

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