Kontali Analyse expects a tight salmon market in the first half of the year

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But the coronavirus is a joker card in regards to price development.

2020 started with a bang. Four straight weeks with record high salmon prices. Subsequently, the effect of the coronavirus, especially for the big fish market in China, hit, with subsequent price declines.

But 2020 still looks to be a historically strong year in terms of salmon prices. The average price for salmon farmers came in at around EUR 7.1 per kg.

Low growth
“What awaits us in 2020?” started Ragnar Nystøyl, Kontali Analyse’s number crusher – an independent world-leading provider of analyses, mainly for aquaculture, during the North Atlantic Seafood Forum in Bergen, Norway, on Wednesday.

Measured in tonnes, large sized salmon from Norway and Chile still dominate the supply side. But what the two have in common is that volume growth is low.

“The drivers behind supply growth are “new” salmon producers, such as Iceland and Russia,” said Nystøyl.

Like most Norwegian analysts, he is especially keen on the supply side when he says something sensible about the price development for salmon.

“January has gone away with zero growth in feed consumption,” he says, adding that due to the algae bloom tragedy last year, Norway has a smaller biomass to harvest this year. “A reduced harvest basis, also in Scotland, will result in a loss of fish in the first half,” he predicted.

Joker card
Kontali Analyse has a base case for supply growth in 2020 of a modest 3.6 per cent. It should, all else being equal, be able to provide still high salmon prices.

The analysis company envisages a total supply of farmed salmon between 2.6 and 2.7 million tonnes. The largest growth, in tonnes, will occur in Norway and Chile, with three and four per cent respectively.

The Joker is the extent to which the much-publicized coronavirus will hit the demand side.

“COVID 19 removes opportunities for consumption of salmon, especially restaurant visits,” noted Nystøyl. The coronavirus has an element of uncertainty,” he added.