‘The salmon party is definitely over’

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“I’m not crying, but maybe others are,” says Kolbjorn Giskeodegard, analyst at Scandinavian bank and financial group Nordea.

Giskeodegard has been skeptical for a long time about the prices of salmon stocks.

“2017 showed a peak for companies’ earnings. Now we are at the top, and in the stock market people may think that this is as good as it gets, and then they sell out,” the analyst said to Norwegian business newspaper Dagens Næringsliv (DN).

Giskeodegard has sales recommendation on all salmon shares with the exception of Austevoll Seafood and Grieg Seafood. The latter he put on Hold, for a surprisingly strong report for the third quarter.

Salmon analyst Knut Ivar Bakken from Danske Bank Markets disagrees with Giskeodegard’s pessimistic view of the sector.

“I do not think the salmon party is over, although it has obviously taken a break last month. Salmon prices have fallen considerably, both due to season and increased volumes, but we believe prices will rise again when we approach Christmas. There are also a number of major promotions in Europe at these price levels that will help increase sales volumes,” he says to DN.

Bakken believes that part of the fall in prices this autumn, is due to increased slaughter volumes in Chile.

“The volume growth we have seen now is a lot about biological challenges, such as the algae bloom in Chile in 2016, and salmon lice problems in Norway last year. Chile is back on track, but in the future production growth won’t be so high anymore. And I believe the underlying demand growth in many markets is good.”