Worst-case tariff impact already priced into salmon stocks says Pareto expert.
Tariffs on salmon imports to the US would be a clear negative, but the market appears to have already priced in the worst-case scenario, according to Pareto analyst Sander Lie, speaking at the North Atlantic Seafood Forum (NASF).
Lie noted that high harvests at low weights and widespread downgrades affected producers in late 2024, but key concerns have since been addressed. “We have a new vaccine in place, the largest companies have got lice levels down, and barbed-wire jellyfish occurances are back to more sporadic incidents. What this boils down to is better biology,” he said.
Quality improvements were evident in Q4 2024, with fish quality reported as 5-6 percentage points higher year-on-year. Lie expects Norway to return to production growth in 2025, though global supply expansion remains constrained by increasing regulatory barriers.
Prices have remained at historically high levels, and the analyst highlighted a shift in consumer behavior, where price-sensitive buyers reduce salmon consumption at seasonal peaks but return in the second half of the year. Despite this, supply fundamentals are expected to support continued strong pricing, with the spot price forecast to remain at around €8 per kilo.
Costs are also declining for the first time in more than a decade. The Pareto feed index has dropped 30% from 2023 peaks, with top producers potentially seeing a profit increase of NOK 8-10 per kilo.
On tariffs, Lie outlined two potential scenarios:
- Tariffs on Canadian salmon imports to the US, which could result in a NOK 0.6 per kilo price impact.
- Tariffs on all salmon imports to the US, which could see stock prices decline 15-20% across the board.
“The short-term effects would be higher prices in the US, reduced demand, and a need to shift volumes to other markets,” Lie said. However, he emphasized that market valuations are already reflecting the potential downside, suggesting limited further impact from tariff-related news.
