Dutch salmon buyers keep their cool after steep price fall

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This week, European salmon prices are at their lowest level of the year. Salmon buyers at Urk are taking the opportunity to buy larger volumes, but not getting over-excited.

“Our customers are building up stocks, so we’ll buy extra volume at the moment and for some weeks now,” says Harm ten Napel, CEO of processing company Het Urker Zalmhuys.

Customers for deep frozen salmon are particularly interested in building up stocks, Ten Napel explains.

“They want to secure their salmon for the coming months. The risk that prices will fall even lower than now is small, so the companies that can afford it are buying more volume now. Customers who usually only buy fresh salmon are also interested in more volume, but we see no major increase at the moment.”

He expects prices to stay at the present level for some weeks more.

“Last year around this time the prices were also at a low level, but that lasted only two weeks. This time we have had four weeks of lower prices already. This has given us more time to create bigger stocks for our customers, so there’ll be less upward pressure on prices in weeks to come, and more volume coming.”

Frozen and fresh

Processor Visscher Seafood is buying extra volume as well, when possible, according to space and capacity. “We only buy extra volume for customers with standing orders,” says Jelle de Boer, international buyer for Visscher Seafood.

This applies to frozen salmon customers only. “We don’t buy any extra for general stock, because we are busy enough as it is. But if there is, for example, 100 tons still to be bought for a contract running until December, we’ll buy it now.”

The low prices have little effect on orders for fresh salmon. “The volumes in that segment are usually smaller, so we don’t see much difference there.”

Supermarket promotions

At Rodé Vis the effects of the recent price developments are not very noticeable, says Sales director Elias Bosma.

“We don’t respond too much to these things. Our factories are already operating at full capacity, so we stick to our planning. Only in frozen salmon there is some increase.”

“You never know how long this will last,” he continues. “Our customers do react to the prices, of course, and some retailers want to run promotions with salmon now. So for them we’ll do a couple of extra truckloads, but nothing extreme.”

Possible setback

“Continuous stable production is most beneficial for us. We have to calculate over a longer period of time. Many customers for frozen want to buy extra at the moment, but we can’t pull a rabbit out of a hat. We have so much demand right now, we can hardly handle it as it is. We are very glad our new factory will be ready in January.”

“In my experience price situations like this always have a downside: a lot of the fish that’s being harvested now was intended for a later period, so chances are October will be an expensive month,” he concludes.