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OSLO, Oct 27 (Reuters) - The price of Norwegian farmed salmon is expected to fall further next week to its lowest level in two years as demand falters and the supply of fish increases, industry sources told Reuters on Friday.
“We are in the low forties, maybe between 40-45 crowns per kilo,” said one salmon producer who declined to be named.
An exporter predicted a price of around 42 crowns per kilo on average.
Prices were last at this level in November of 2015.
“The market is failing and thousands of tonnes of salmon are unsold. We have priced ourselves out of the market for the last two years, and now it’s pay-back time,” the exporter said.
“Storage facilities are full and it’s not possible to freeze more salmon. I’m sure prices will drop below 40 crowns.”
In the current week, salmon was sold at around 46-48 crowns per kilo while initial expectations, as seen a week ago, was for stable prices at around 49-50 crowns.
Final prices for the current week will be recorded on Tuesday next week at the Nasdaq Salmon bourse.
Salmon prices peaked at around 80 crowns per kilo in early January at a time when supply constraints supported prices, but have since fallen as volumes grew.
Norway is the world’s top salmon exporter, and the share price of listed farming companies depends heavily on changes in the price of fish.
Average production costs for whole fish, including the cost of harvesting, rose by 13 percent to 34.29 crowns per kilo in 2016, according to data from the Norwegian Directorate of Fisheries.
Leading Norwegian producers include Marine Harvest, Salmar, Leroy Seafood, Grieg Seafood and Norway Royal Salmon. (Reporting by Ole Petter Skonnord, editing by Terje Solsvik)