Salmon prices have dropped like lead in the past weeks, but more concerning is that the price has fallen on the lowest sales volumes registered in many months, writes Aslak Berge, editor of the salmon news website iLaks.
The spot price of Norwegian farmed Atlantic salmon has fallen by NOK 5-6 per kilo in the past three weeks.
This collapse is definitely not due to the supply side. Weekly salmon export volumes from Norway over the same period have indeed fallen by nearly 2,000 metric tons.
Last week, 16,691t of farmed salmon were exported, according to the Norwegian Seafood Council.
In theory, lower supply should mean higher prices. Yet the opposite has happened -- prices have dropped sharply.
Everything suggests that the explanation is therefore on the demand side, not supply.
After the highest prices in two decades, it has become clear that buyers of salmon -- smokers, retail chains, foodservice buyers, etc -- are finding their purchasing power and credit lines stretched out to the extreme.
Western Europe is by far Norway's largest, and most important, end customer for Norwegian producers.
Unlike Norway, a significant part of this region, including France, the UK, Spain and Italy, is still affected by the so-called credit crunch, the sovereign debt crisis, the house prices bubble, high unemployment and low economic growth.