Extreme heat dampens salmon demand

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Sales of salmon have dropped and many blame the summer heat.

Last Friday, SalmonBusiness reported on sharp falling salmon prices for delivery this week.

“Now it is very quiet in Europe, where its warm and low willingness to buy. In addition, there is a critical large amount of fish up to six kilos. It’s naturally a very bad combination for the price next week,” said one exporter.

“The market is characterised by the holidays among our buyers, and that it is extremely hot in Europe. They are eating ice cream instead of salmon,” added a seller at a salmon farmer.

Capacity
The price landscape was confirmed by the investment bank Pareto Securities this week.

“The spot price continues to fall, and we expect prices around NOK 47 (EUR 4.8) per kilo this week. Lower European capacity in the summer holidays combined with the extremely hot weather are the reasons behind the low prices,” Pareto analyst Carl-Emil Kjølås-Johannessen wrote in an analysis update.

Low Season
“Although we expected prices to follow their seasonal pattern and fall towards the end of July / early August, prices are now lower that at the same time in the last three years,” he adds.

Summer is the low season for salmon sales, and observations so far do not indicate that 2019 is an exception.

Source: Pareto Securities

Weak demand
Sparebank 1 Markets salmon analyst Tore Tønseth expects the salmon market to pick up again before prices fall seasonally in the autumn.

“There has been a slightly weak spot price lately, which is most likely a result of slightly weak demand due to the heat and perhaps a slightly higher volume,” he told TDN Direkt.