Dutch supermarkets stick to their contract prices

News
3027

Dutch consumers aren’t benefiting yet from the Norwegian salmon price drop.

In spite of the fall in the salmon prices in the past months, consumer prices for fresh salmon in Dutch supermarkets have hardly changed.

In the period from September 22 until today, Albert Heijn, owned by Ahold Delhaize, with 1,008 stores the biggest retail chain in the Netherlands, kept its prices between €26.50 (fillets with skin) and €30.50 (without skin) depending on packaging.

At Jumbo supermarket, the second largest Dutch retail chain, with 584 stores, salmon prices also have stayed stable between €24.90 (fillets with skin) and €30.90 per kilo (without skin).

Only Lidl, the German supermarket chain with over 10,000 stores in Europe, of which 415 are in the Netherlands, did some serious promotion on the weekends, from the end of September and all through October, with offers at €17.80 per kilo, for salmon fillets with skin. With Norwegian prices between €5.50 and €5.10 for sizes 3+, at that time, for whole fish, gutted, of which about 45 percent remains after filleting, that still gives a slight profit.

Contracts and Fish Pool
According to a source from a European wholesaler who also supplies Dutch retailers, price contracts with retail customers are common.

“If we enter into a contract with a retailer, we make a proposal that is feasible for us. We consult in advance with the sourcing side, to be able to offer the required volume. When consulting with the source, we ask for a guaranteed price for that volume. We do that with all our retail customers. This way we cover ourselves against price changes.”

“The other system is Fish Pool. But there, too, we are committed to linking sales and purchase contracts.”

Back to back contracts are necessary, he explains. “But you have to be able to react to price changes by doing part of the business at Fish Pool.”

Margin opportunities
For the past four weeks, Norwegian salmon prices have been relatively stable, with some slight drops. In the coming week prices are expected to drop to €4.90 per kilo, for sizes above 3 kilos. With the low prices and huge amounts of fish of the moment, there should be plenty of margin opportunities, even with promotions.