SEB believes that commodity inflation can strengthen salmon’s relative competitive position

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Analyst sees opportunities.

“The pandemic has led to fish feed, a major cost component for farmers, becoming more expensive. However, feed for competing protein is also becoming more expensive, and salmon trumps meat according to feed factor,” SEB analyst Bent Rølland told Finansavisen .

Commodity inflation can consequently strengthen the salmon’s relative competitive position, he believes, and adds that he believes salmon prices will rise much more than feed prices.

Read also: Fertiliser price shocks could result in more expensive fish feed

“Demand in the hotel, restaurant and catering segment (HoReCa) has not yet normalized, but here the global potential is great,” he noted.

Rølland highlights Lerøy and Grieg seafood as “trading with a disproportionate discount”. He is skeptical of SalMar’s offshore investment, which is given a neutral recommendation.

The only stock he has a sell recommendation on is Atlantic Sapphire, as “salmon farming on land, especially in tropical areas, is energy-intensive and expensive, and the technology is still uncertain”.