Salmon prices are heading for a record this year as colder sea temperatures in Norway, the world’s biggest producer, spur the first decline in output in 12 years, according to Rabobank International.
Norway’s Atlantic salmon production will probably drop by about 4 percent from 2012 to 1.15 million metric tons, after output more than doubled in the past seven years, said Gorjan Nikolik, a senior industry analyst at Rabobank in Utrecht, Netherlands. Export prices were 37.70 kroner a kilogram ($3.23 a pound) as of March 17, near a 22-month high and 30 percent more expensive than at the same time last year, Statistics Norway data show. Prices may climb to 45 kroner by the end of June, topping a record 43.61 kroner in April 2011, Nikolik said.
Warm sea temperatures in winter 2011 sped up fish growth rates and spurred a 19 percent jump in Norway’s Atlantic salmon output in 2012, Nikolik said. That sent prices to an 11-month low at the end of September and encouraged grocers to discount salmon, ultimately boosting consumer demand, he said. Prices have surged 57 percent since then, helping the country’s exports achieve a record value in February of 2.5 billion kroner, according to data from the Norwegian Seafood Council.
“There is no expected growth in salmon production in Norway in 2013, and there has been a very high demand for salmon,” Egil Sundheim, the director of market information for the Norwegian Seafood Council in Tromso, said by telephone today. “Prices will remain fairly high throughout the year.”
Sea temperatures have normalized at a cooler level this year, slowing growth rates, Nikolik said by phone on March 12.
Marine Harvest ASA, the world’s largest publicly traded salmon farmer, said in a Feb. 6 report that it expects Norwegian salmon supplies to decline 3 percent to 6 percent this year, while output in Chile, the world’s second-biggest producer, climbs as much as 36 percent. Chile’s production is rebounding after an infectious anemia virus sickened fish and ravaged its farms in 2007.
Consumer prices for farmed salmon in France, Europe’s biggest import market, were 10.71 euros a kilogram ($6.29 a pound) in February, 13 percent higher than a year earlier, according to the National Institute of Statistics and Economic Studies. Norwegian exports of whole, fresh or chilled salmon rose to a record 83,506 tons in November, a time when production usually reaches a peak before declining seasonally, Sundheim said.
“This high-price environment will stay for a while, certainly for most of this year, although the highest jumps will be in the first half,” Rabobank’s Nikolik said. “We could easily break previous records.”