Miami-based Claire was speaking to Robert Reierson this week, as part of Tradex Foods’ latest 3-Minute Market Insight.
“The volume increase from 2016 is not significant at 2%,” reflected Claire. “So in a market where demand keeps on growing at a 5% rate per year, you're only seeing a 2% increase in supply from Norway.”
“The markets are very volatile and the global economy makes predicting the prices of salmon very complicated. We have to deal with everything from global economies, currencies, even the oil price actually affects the salmon prices because the Norwegian Krone is an oil-based currency. So it's been very difficult – a lot of people again have been expecting sharp drop in price starting now and into Q3 both for Chile and Norway and I guess for global market. We're not seeing a significant drop in prices at the moment,” he continued.
“Again Chileans have been able to harvest even more fish than expected while keeping very high sales prices for fresh Trim D fillets into the US. As of today they are still getting close to $6 per pound for Trim D fillets, although we have passed Mother's Day and most retail programs and ads have ended…we’re still seeing very strong pricing following of course the high prices Norwegian fish into the month of May,” he added.
Also of note is the recent diversification of farmed salmon markets – following the recent agreement between Norway to recommence seafood trade with China, import delays should normalize within the summer months.
“Another very important thing is that all producers – including Norway, Chile, Scotland, Faroe and Canada - have learnt in the past 3 or 4 years to find and diversify new markets and also [produce] more value-added product, meaning suppliers have more avenues for their fish in general,” he reflected.
“A very interesting case that's about to happen is Norway's negotiation with China, again Norway's now free to send fish into the Chinese market, which could mean up to 100,000 tonnes of fish being diverted to new markets,” he continues.
“The other important part of that issue is if China will remove the duties into the Chinese market - I believe it's 20 percent right now, which would of course grow tremendously the amount of volume that can be sent from Norway into China,” he explained.
In the meantime, buyers in North America can expect good pricing on farmed Atlantics for the next 3-4 months, until inventories clear.