May 25, 2018 / 12:17 PM / in a month

UPDATE 2-Norwegian salmon price seen plunging, shares of fish farmers drop

* Salmon price drops to NOK 65-70 from NOK 80 -sources

* Exporter blames warmer weather, ‘tired’ importers

* Shares of salmon farming companies turn lower (Adds bullet points, share prices)

By Ole Petter Skonnord

OSLO, May 25 (Reuters) - The price of Norwegian farmed salmon is expected to fall by 10-15 crowns next week to around 65-70 Norwegian crowns per kilo for deliveries in Oslo, partly due to an increase in supply, two industry sources told Reuters on Friday.

In the current week, prices stood at around 80 crowns per kilo.

In addition to growing volumes of fish, the recent high prices have also in themselves dented demand, the sources said.

“It’s a big drop, probably down 10-15 crowns from 80 crowns this week,” said a producer who declined to be named.

“There are no more public holidays, the sea is warmer and production is increasing,” he added.

A fish exporter expected a price drop of 13 crowns to about 66-67 crowns, adding that importers were worn out by the recent surge in the cost of salmon.

“Our customers are tired (of high prices), and we have also lost money during the last couple of months. We believe prices could drop more,” he said.

In late January, the price of salmon stood at around 50 crowns per kilo, on fears of strong supply growth, but a cold Norwegian winter instead resulted in slower growth in fish stocks, giving a new price spike.

On top of this several bank holidays in Norway in May have cut the volume of harvested salmon and helped push prices to near record highs.

Norway is the world’s top salmon exporter, with fish farming the Nordic country’s second-largest export industry after oil and gas production. 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.

By 1225 GMT, shares of Marine Harvest traded 1.2 percent lower for the day, reversing an earlier rise of about one percent. Similarly, Grieg Seafood, Salmar, Norway Royal Salmon and Leroey all traded down from 0.9 to 1.7 percent. (Editing by Terje Solsvik)

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