Canadian farmed salmon prices to rise on Chilean losses

Published on
May 10, 2016

The Canadian farmed salmon price is expected to rise again in the second half of 2016 because of Chile’s massive toxic algae bloom and port protests that are halting exports.

Canadian farmed salmon prices doubled for some sizes from 1 January through Easter, partly driven by the Chilean algae bloom, Dave Mergle, managing director of Ocean Quality North America, the sales organization for Grieg Seafood and Bremnes Seashore, told SeafoodSource.

After Easter, Canadian prices declined and then reached a plateau, but now buyers are starting to experience upward movement, Mergle said. The problem could be temporary – linked to Chile’s shipping problems – but he expects prices to remain strong.

“We are starting to see the start of a big market move. I expect that won’t stop until 2017,” Mergle said. The higher overall farmed salmon prices could cause consumers to purchase other proteins. However, salmon is “still one of the lowest-priced proteins and will continue to be a big protein – even with prices being what they are – because it is such as staple,” Mergle said.

The global increase in farmed salmon prices is a “horrible situation for Chile and is bad for salmon aquaculture globally,” said Jeremy Dunn, executive director of the British Columbia (Canada) Salmon Farmers Association.

“A short-term price increase is helpful in many businesses; but, long term, it is going to be an affordability challenge for many people who want to eat salmon on a regular basis and for people wanting to carry it in their restaurants and retail stores,” Dunn said.

As a result of the Chilean problems, demand for B.C. farmed salmon jumped in the first quarter of 2016 – but was also much higher in 2015, when production soared to 75,000 metric tons. In fact, B.C.’s farmed salmon export value reached a record CAD 431.6 million (USD 335.6 million, EUR 294.2 million) in 2015.
B.C. shipped a record 52,150 metric tons of farmed salmon to the U.S., or CAD 404.9 million (USD 314.9 million, EUR 276 million) worth.

Plus, China became B.C.’s second biggest farmed salmon export market after the U.S. with a record CAD 9.2 million (USD 7.2 million, EUR 6.3 million) shipped in 2015. The increased shipments to China resulted from increased marketing by salmon suppliers as well as an improving economy in the country.

“Both Marine Harvest and Cermaq in B.C. have put an increased focus on that marketplace. Cermaq being bought by Mitsubishi has opened up some avenues for that company in Asia,” Dunn said. “If we had more fish to sell, I believe that marketers would be selling more to China.”

Because of the improving economy in China, “You have people wanting to pay more for high quality proteins,” Mergle said. ”We are really keen on expanding our business to China as much as we can.”

Overall exports to Asia jumped 30 percent to CAD 20.5 million (USD 16 million, EUR 14 million) over the previous record in 2013. One factor benefitting exports was the Canada-Korea Free Trade Agreement, which allowed B.C. suppliers to export fresh farm-raised salmon to South Korea for the first time.

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