Investment bank expects negative supply growth, so has lifted the price estimate for salmon

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DNB Markets adjusted its salmon price estimate for 2021 and 2022 to EUR 5.9 and EUR 6.2 per kilogram respectively from previous EUR 5.5 and EUR 6.

DNB Markets said in a sector report on Tuesday that it expects the double-digit global supply growth seen in the fourth quarter of 2020 and the first quarter of 2021 to shift to negative year-over-year growth over the next four quarters, reported TDN Direkt.

“Given the low supply growth and reopening of the HORECA market in the second half of the year, we expect the supply dynamics over the next 12 months to reflect what we saw in 2013 and 2016, however, share prices close to all-time high suggest that the market expects a similar trend,” wrote DNB Markets.

The investment bank made several adjustments to its price targets and wrote that Lerøy Seafood and Austevoll Seafood continue to be their top picks in the sector, reported TDN Direkt.

Despite the increased price trajectory, DNB Markets maintained neutral recommendations on Mowi, Bakkafrost and SalMar.