Salmon prices predicted to stay strong for next two years
Analyst points to limited supply growth as major factor
Limited supply growth will keep salmon prices strong in the next couple of years, according to a sector analyst in Norway, the world’s biggest producer of farmed salmon.
The average spot price for Norwegian fresh salmon so far this year is NOK 96.97 (£7.39) per kilo, compared to NOK 86.19/kg a year ago.
Sander Lie, a salmon sector analyst at Pareto Securities, told Fish Farming Expert’s Norwegian sister site Kyst.no that Pareto expects an average price of NOK 90/kg for salmon for 2023.
“Q3 seems to end around NOK 77/kg and somewhat above our original estimate. For Q4, we currently have an estimate of NOK 77/kg,” said Lie.
NOK 87 per kilo
Pareto Securities is currently expecting a slight price drop in the average price of salmon next year, to NOK 87/kg.
“This is mainly because we expect some growth in supply compared to this year. However, we believe in a price increase again for 2025 and argue that growth in supply looks very limited in the next couple of years and that we are entering a longer period of high salmon prices,” he said.
“At the same time, one should not forget how it looks in Euros. Part of the development is due to a weak krone.”
The analyst noted that one concern is how the demand for salmon may be affected by the weakened purchasing power of consumers.
Rising interest rates
“After all, we are in a macroeconomic climate with rising interest rates, which are only beginning to affect the end consumer now. Historically, however, it has been seen that the demand for salmon held up well despite a weaker macro economy,” he said.
So far, the demand for Norwegian salmon in the market seems to have held up well, he said.
“Although Norwegian exports in isolation do not paint the whole picture, you can see that the total export volume is down approximately 3% this year, while total export value in is up 17% in kroner year-on-year (+4% in Euros). We believe that is also a good, if not better, benchmark for what the demand picture looks like, compared to volume in isolation,” he said.