January 24, 2017
Salmon prices are driven by global supply and demand and supplies this year are not likely to fill the orders of a steadily growing customer base.
It looks like this year farmed production will be down and the large European investment banks that finance a lot of farmed salmon activity, they don’t expect global farmed production to go above last year until 2019.”
Andy Wink is Senior Seafood Analyst with the McDowell Group.
The farmed shortfall stems from the loss of millions of farmed salmon from Chile due to a deadly virus from toxic algae in warming oceans. The U.S. is Chile’s largest customer, importing nearly 300 million pounds of Chilean farmed salmon last year worth more than $1 billion. To combat the virus Chile has come under fire for using more than one million pounds of antibiotics in its fish pens.
Norway is the world’s biggest farmed salmon producer. But therein lies another problem.
While a virus is killing Chile’s fish, swarms of sea lice are ravaging salmon farms in Norway. Sea lice are the farmed salmon industry’s most costly problem, costing around $550 million in lost output each year. Salmon farmers commonly use a pesticide called Slice in their salmon feeds to combat the sea lice. But they are finding that it’s getting harder to wipe out the parasites without also killingthe fish. Norway’s exports were down by five percent, while global production fell around nine percent. Andy Wink –
“So we’re looking at several years of either lower or constrained supply growth for farmed salmon. And that is pretty important because typically farmed salmon production has grown around 5 percent a year over the last 20 years.”
A survey last year by global market researcher Mintel showed that three-quarters of Americans prefer ‘free from’ foods , meaning free from antibiotics, hormones and other additives. By law,all fish sold in the U.S. must be labeled as farmed or wild, and show its country of origin. Of course, the safest solution is to buy wild salmon.
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