Norwegian salmon prices dipped last week after increasing sharply in the past month — they are still up 30 per cent since September — despite Russia’s retaliation against EU and US sanctions and helped by soaring seasonal demand for the Christmas and new year holidays.
Prices have been falling as warm seas, which increase fish growth rates, led to larger quantities coming on to the market earlier in the year than expected, according to Mintec, the commodities data analysts, but fewer fish are currently being kept on farms.
In May the volume on farms was up 10 per cent year-on-year but the stocks fell, however, to only 1 per cent ahead in October and are expected to have fallen even further in November, the analysts said.
The shortage means supplies are at a similar level to those in 2013 while demand has risen in preparation for the holiday season.
But last week after the continuously higher prices and higher export volumes, there was a sharp price fall of around NKr8 to NKr41 a kilogram, the single largest weekly drop in a decade. This tumble was due to the prices Norwegian farmers and exporters charge existing EU clients proving too much at peak volumes at this stage of the year.
In the sanctions between Russia and nations opposing annexation of Crimea, one retaliation by the Kremlin was to include fish in a list of banned products from the EU, Norway, Canada, the US and Australia. Russia buys 110,000 tons of salmon from Norway alone.
More broadly, the FT has already reported that market watchers say fish farming will continue to grow as the level of fish caught in the wild has levelled off since the 1980s. The UN Food and Agriculture Organisation forecasts per capita fish consumption of farmed fish will increase by 4.4 per cent in 2014 from a year ago to an annual 10.3kg, rising for the first time above the equivalent figure for wild fish, predicted to fall 1.5 per cent to 9.7kg.
But the precarious business of fish farming was highlighted when a jellyfish invasion in the Western Isles of Scotland recently wiped out nearly 300,000 young salmon worth around £1m.
The mauve stinger jellyfish, pelagia noctiluca, are small enough to get inside salmon cages. The jellyfish swarmed at salmon company Loch Duart’s farm on North Uist.
Poor weather that followed the incident prevented the fish from recovering from their injuries. Loch Duart said half its stock at the farm had died.
In 2007, the stinging jellyfish swamped salmon cages off Northern Ireland before later appearing in swarms around the coast of Highland Scotland. Billions of the creatures covered an area of up to 10sq miles off the County Antrim coast.