Analysts: Norway algae crisis will push up Q4 salmon price

Danske Bank analyst Knut-Ivar Bakken told Fish Farming Expert’s Norwegian sister site, Kyst.no, that the bank expects the salmon price to follow typical seasonal fluctuations and be lower in the second half of 2019, compared with the first half.

“We nevertheless believe that slightly higher prices will be seen in the fourth quarter of 2019, compared with the fourth quarter of 2018,” he said.

Moderate supply growth

He added that the bank believes that the demand for salmon will continue to be good, and that supply growth of salmon will be moderate.

“Looking at prices ahead and comparing year over year, it will be stable to slightly higher in the coming years.”

Peter Jebsen in Pareto Securities has the same expectations for salmon prices in 2019 as Bakke and added that the driver for the higher salmon price is lower volumes as a result of the algal blooms in May.

“We therefore expect an average price of NOK 58 per kg in the third quarter and NOK 62 in the fourth quarter,” Jebsen told Kyst.no.

Prices up to NOK 60

Nordea Markets salmon analyst Kolbjørn Giskeødegård agreed with the analysis for Pareto Securities that the algal blooms will affect salmon prices positively in the last six months of 2019, compared with the previous two years.

“We expect salmon prices in the period of high fifties, and up to sixty,” said Giskeødegård.

He adds that the price depends on several factors such as the supply of salmon from Chile and how strong the Norwegian krone will be.

“If the krone strengthens against the euro to an unexpected extent, then one will get a lower price in Norwegian kroner than would otherwise have been the case,” he explained.

He added that if salmon farmers in Chile are forced to harvest more this autumn due to lice challenges, it can also put more pressure on salmon prices in, for example, North America and Asia.

“It is normal uncertainty as always,” he concluded.