Fire at Heathrow hits large salmon market.
A combination of strong growth conditions at sea and logistical disruptions is pushing the price of large salmon below that of smaller, industrial sizes.
“It’s difficult with large fish. There’s a lot of large fish out there,” a buyer told SalmonBusiness with frustration. “Last Friday the price for 5+ kg was high, but that’s taken a hit this week. All slaughtered fish have a higher average weight than expected.”
“Prices have dropped significantly this week. We’re not done yet, and many are left holding unsold fish. It’s getting ugly.”
He pointed to the following prices being offered to producers for the coming week:
3–4 kg at NOK 76 ($7.22/€6.69)
4–5 kg at NOK 78 ($7.41/€6.86)
5+ kg expected to fall below the 4–5 kg price bracket, at NOK 76–77 ($7.22–$7.32 / €6.69–€6.78)
“And then there’s the fire at Heathrow, which is making things more complicated. I read online that it could take 2–4 days to get things back up and running. That’s going to create a backlog. So 5+ kg is going to be rough. Heathrow is possibly the biggest hub for air freight. There’s some going through Schiphol and Frankfurt too, but not nearly as much, especially when you include fillets.”
Air-freighted fish destined for overseas markets are typically from the heaviest weight classes.
“Some 1,300 flights have been cancelled. That matters,” added another exporter. “A huge amount of salmon goes out by air from there—to the US and other markets.”
The fire at London’s Heathrow Airport is believed to have started at an electricity station near one of the terminals.
“The air’s gone out of the market. Prices have dropped like a stone. And the krone has strengthened. That’s NOK 3 on the exchange rate in just a week. There’s a lot of nervousness. Buyers likely thought they could clear out their inventories.”
Growth pressure
“If we’re going to make money, we have to buy at the following levels:
2–3 kg at NOK 72 ($6.84/€6.34)
3–6 kg at NOK 77–78 ($7.32–$7.41 / €6.78–€6.86)
6+ kg at NOK 75 ($7.13/€6.60)”
“We’re not buying shipments with high average weights. There’s just going to be too much large fish. Growth is strong. Every fish we’re getting in is half a kilo heavier. Markets have slowed a bit in Italy and Spain. It happened suddenly,” he said.
“There’s a lot of unsold large fish—5+ kg—this week. Unfortunately. But it’s not a crisis. We’re building new markets.”
“Plane crash,” a trader wrote in a text message, referring to the fire at Heathrow.
