Supply shortage drives Norway salmon prices to record heights
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Norwegian salmon prices for all but the largest sizes have reached record heights amid reduced availability of fish in the market.
“The prices are very high. There is little fish available, and much of what is slaughtered is production fish. As a result, the price of the superior fish will be even higher,” an exporter said.
Salmon is classified as either superior, ordinary, or production fish. The reference price relates to superior fish. Normally more than 90 percent of the total is superior.
Lower-quality salmon, referred to as production fish, accounted for over 30 percent of the sales this winter.
The price discount between superior quality salmon and production fish is unusually large, with a discount of around NOK 50-60 (€4.29-€5.15/$4.63-$5.56) per kilogram, industry sources said.
Typically, less than 10 percent of the salmon is production fish, but in the winter the proportion may be higher due to winter sores, among other things. Wounds and unsightly parts are removed for export.
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Production fish must be first be processed in Norway before they can be shipped to foreign buyers, although this could change after the European Commission’s trade department, DG Trade said this month Norway’s export ban on low-grade salmon amounts to a trade barrier.
“What is happening now is very unfortunate, with a major imbalance in the market,” said a second exporter.
A third exporter reported buying fish in northern Norway at between NOK 132-139 (€11.34-€11.94/$12.24-$12.89) per kilo.
“Crazy,” he wrote in a message.
A producer reported even higher prices.
“We get NOK 135-145 (€11.60-€12.46/$12.53-$13.46) per kilo for fish between 3 and 6 kilos. There is a low supply, and a lot of production fish. These are very high prices, but as I see it, it is not the market that is driving them up. The reason for the high prices is reduced supply,” he said.
Futures contracts are also trading higher on the Fish Pool salmon exchange.
“For the second half of the year, buyers are offering NOK 88 (€7.56/$8.16) per kilo, while sellers want NOK 89 per kilo. The market is thus pricing in an increase of around 10 percent from the same period last year,” said Fish Pool Managing Director Soren Martens.
“Everyone is talking about the fact that there is a lot of production fish, and an unusually large price difference between it and the superior fish,” Martens added.
An IntraFish survey of market sources revealed the following prices:
3–4 kg: NOK 129–135 (€11.08-€11.60/$11.97-$12.53)/kg
4–5 kg: NOK 132–140/(€11.34-€12.03/$12.24-$12.98)kg
5–6 kg: NOK 135–145 (€11.60-€12.46/$12.53-$13.46)/kg
6+ kg: NOK 135 – 145/(€11.60-€12.46/$12.53-$13.46)/kg
On Friday afternoons in Norway, contracts for fresh salmon are entered into for the next week’s spot market trade.
Prices usually vary between different weight classes and production areas, and may also vary depending on which market the fish is sold to and delivery day. In that sense, there is not one, but many, salmon prices.
IntraFish’s price story is a snapshot at the time the article is published. Prices are often a combination of actual trades and expectations of trades later in the day.
While the use of anonymous sources can be problematic, the overwhelming majority of sources insist on being anonymous to discuss their trading. We strive to get a balanced view from both farmers, exporters and processing companies.
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