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2012 Salmon Price Outlook Negative as Production up

GLOBAL - From mid-2012, with new production coming to market from both Norway and Chile, prices could easily fall to very low levels, according to Globefish.

The first six months of 2011 were characterised by high farmed salmon prices. Producers made tremendous margins, at times close to 50 per cent, while processors, smokehouses, retailers and users of salmon as raw material for value-added products saw losses grow as they were not able to pass on the full price increases to customers. Since then prices have collapsed.

It is possible that some long-term structural changes in the market are being seen, with frozen fillets playing a larger role. Generous harvests in Alaska and Russia have supplied China with available raw material for frozen fillets that are re-exported to Western markets. Although these do not compete directly with fresh Atlantic salmon, they do indeed create competitive pressure regarding prices and margins.

Both Norway and Chile, two of the leading salmon producing countries, are increasing production, putting further pressure on prices.

Charlotte Johnson

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