According to Fish Pool’s forward prices, the per kg spot price for salmon will rise to €6.8 in December. The industry is skeptical.
In particular, Ståle Høyem, who buys salmon for the giant Polish smoker Suempol, is skeptical about the price forecast. He believes salmon prices will stay where they are.
“More hope than belief”
“No, I don’t believe in Fish Pool’s forecasts. I realize that Fish Pool and Nasdaq are misused for all they’re worth. It’s the best tool one can have to trick the market into believing that salmon prices are high. Fish Pool take orders on very few tonnes. With these orders, they provide proof that they are trading at the given price level, but those volumes are not representative of what is happening in the market. I have no trust in it, whatsoever”.
“That price is based more on a hope than belief. I believe the price level will stay where it is,” he adds.
Last year, Suempol sourced around 40,000 tonnes salmon, while Høyem, bought salmon for roughly €210 million.
Arve Solskjær, purchaser for Norwegian salmon exporter Seaborn, is not as bombastic as Høyem.
“I’m really not sure about that. The volume that was expected has not arrived. I believe a price around €6.8/kg is a bit high. It could happen, but I’m not sure,” he tells Salmon Business.
Less volume than expected
Last week, Salmon Business reported a spot price of about €5.3/kg. If Fish Pool’s forecasts are correct, it would mean a price hike of just over 26 percent in two months.
“We are dependent on the growth, and the volume, which everyone expected, hasn’t come. Marine Harvest reported lower volumes in the third quarter compared to what we expected and they do not believe that they will regain what they lost,” he adds.
“If that’s the case, for Marine Harvest and other companies, then prices might rise.”
Audun Bjelkarøy, exporter at Selected Seafood, tells Salmon Business that the flow of information about factors that affect the price development is poor. Therefore, he is struggling to predict prices in the future.
“The information-gap that might give a price indication is very big. It’s hard to predict,” he says.
He attaches extra importance to the fact that the major players in the industry can pretty much set the price.
“The big companies, which make up 60 percent of the licensing market, run the price market themselves. On one side, it is difficult to see their plans from week to week. When they, for different reasons, harvest extra salmon, we see an immediate price reaction.”
Bjelkarøy still believes there could be a small price jump at the end of the year. However, he has seen that customers prefer to take fish from cold storage when the price rises to around €5/kg.
“I see that they withdraw when the prices are that high,” he says.
Doubts Fish Pool prices
Bjelkarøy is also skeptical about whether Fish Pool contracts represent the real market prices.
“I see that Fish Pool contracts are relatively high compared to real market prices. There is a distance between real market prices and those in Fish Pool.”