Falling salmon prices drag down Norwegian export value in the first half of the year

In June, Norway's seafood exports recorded a historic drop in value, having never before fallen by more than NOK 2 billion in a single month.
Packaged Norwegian salmon fillets in a supermarket display.

Although there was no growth, the first half of the year 2024 was the second best in history in terms of value for Norwegian seafood exports, only last year was better.

Photo: Norwegian Seafood Council.

After the best May ever for Norwegian seafood exports, which made us think that the March blip (the first month in which their value fell after three consecutive years of growth) was just an exception in their history of steady growth, June has put everything back into perspective. With results dragged down by the fall in salmon prices, a weak June was enough to cause a drop in seafood exports in the first half of the year.

"Salmon still accounts for 70% of the total value of Norwegian seafood exports, so when the price of fresh whole salmon fell by as much as NOK 31 in June compared with the previous month, it had a major impact on the total value," stated Christian Chramer, CEO of the Norwegian Seafood Council (NSC).

In June 2024, the total value of seafood exports amounted to NOK 12.1 billion (EUR 1,057 million/ USD 1,146 million), falling by 18% - NOK 2.7 billion (EUR 235.9 million / USD 255.8 million) - compared to the same month last year. As explained by the Norwegian Seafood Council in its release, this is a historic change, as never before has the value of exports fallen by more than NOK 2.0 billion (EUR 174.7 million / USD 189.4 million) in a single month.

A bad semester, which is not so bad

However, despite this drop, if we look at the figures in perspective, this first half of the year has not been so bad. From January to June 2024, Norway exported seafood products worth NOK 80.6 billion (EUR 7.043 million / USD 7.638 million), which is down NOK 1.6 billion (EUR 139.7 million / USD 151.5 million) compared to the first half of 2023. In percentage terms, this translates into a drop of only 2%. But not only that, as the NSC CEO explains, that figure has only been exceeded once, in 2023, which was the best value year ever for Norwegian seafood exports.

"Although there was no growth in value, the first half of the year was the second best ever in terms of value. Only last year was better," Chramer said. "A weak Norwegian krone and high prices for cod and salmon boosted value in the first five months of the year. However, the growth stopped in June, which is largely driven by falling salmon prices."

A view reinforced by the statements of the Minister for Fisheries and Oceans, Marianne Sivertsen Næss. "Despite the downturn, the seafood industry is delivering strong figures with the second-best half-year figures ever," she said. "Nevertheless, weakened purchasing power in key markets, lower export volumes and increased competition from other seafood nations is something we must take very seriously, including through our work on market access."

For his part, the CEO of the Norwegian Seafood Council confirmed the Minister's opinion about the weakened purchasing power in the main consumer markets. "Even with lower inflation and the prospect of real wage growth in our key EU market, prices for both food and other goods have risen more than incomes in recent years. Real wages in the EU are not expected to return to 2021 levels until 2025," Chramer explained.

In addition, for this drop in the value of Norwegian seafood exports to occur, another determining factor was added to the drop in salmon prices. In the first half of the year, quotas for several wild-caught Norwegian species were reduced, affecting the value of cod, king crab, herring, and mackerel.

In any case, in the first half of the year, Norway exported seafood products to a total of 144 countries, two more than in the first half of last year. The largest markets for those exports were Poland, Denmark, and the United States, while Canada had the highest growth in value, with an increase of 34% - NOK 211 million (EUR 18.4 million / USD 19.9 million) - compared to the first half of last year. Exports to Canada totaled 15,457 tons, 45% more than in the first half of 2023.

Not all species in the export value top 10 showed declines

Although declining in both volume and value, in the first half of the year salmon continued to top the Norwegian top 10 of the largest species in terms of value with a total value of NOK 56.3 billion (EUR 4.9 billion / USD 5.3 billion) - this is -3% -, followed by cod with NOK 6.8 billion (EUR 593.7 million / USD 643.6 million) - this is -6% -, and trout with NOK 2.9 billion (EUR 253.1 million / USD 274.4 million) - this is +27%-. Saithe, herring, mackerel, haddock, shrimp, snow crab, and capelin are the species that complete the top 10.

As mentioned, from January to June 2024, salmon saw its value fall by 3% compared to last year, while volume fell by 4%. Poland, Denmark, and the United States were its largest markets. However, in addition to the aforementioned fall in prices, the Norwegian fish product par excellence, suffered this semester an increase in competition, not only from other exporting countries, but also from other species such as trout.

Compared to Norwegian salmon, trout originating in Norway grew by 44% in volume, driven mainly by the increase in exports to Ukraine, which amounted to 6,586 tons, 272% more than in the first half of last year. "Ukraine is a market for both salmon and trout," explained NSC Seafood Analyst Paul T. Aandahl. "Despite a 30% decline in the export volume of salmon, the export volume of salmonids increased by 11%. The shift towards trout to Ukraine must be seen in the context of lower prices for trout compared with salmon."

If we talk about cod, the other quintessential Norwegian species, it did not have it easy in the first half of 2024 either. Due to reduced quotas, landings of fresh cod fell drastically, and with them export volumes. In the case of fresh wild cod, export volume fell by 29%, while export value declined by 24%. However, this drop was offset by a rise in fresh farmed cod, which increased by 28% in volume and 51% in value. Farmed cod accounted for 21% of the value of fresh cod exports in the first half of the year, the highest ever.

Saithe, herring, and mackerel also suffered a decline in the first six months of the year. The same happened with king crab, which had a weak semester and did not even enter the top 10 species with the highest export value, despite having obtained a record price for live king crab. In contrast, haddock, prawn, snow crab, and capelin did make it to the top and, moreover, had a favorable six-month period.

Prawn, in particular, reached its strongest half-year in 24 years, with a value of NOK 800 million (EUR 69.8 million / USD 75.7 million). Value grew by 17% while volume grew by 52%. "Good fishing in the Barents Sea, and thus increased volumes, have characterized exports in the first six months of the year," explained NSC Seafood Analyst Marte Sofie Danielsen. Sweden, the United Kingdom, and Denmark were the largest markets in these six months, while Canada is the fastest growing market for this species, as a consequence of lower supply in its own catches.

Snow crab, on the other hand, reached a record export value during a six-month period with 6,302 tons worth NOK 711 million (EUR 62.1 million / USD 67.3 million), which is 48% more than last year, while the volume increased by 33%. "The value record is due to an increased supply of snow crab and an improved market situation compared with last year. The quota increase is the largest contributor to value growth. The quota was depleted in record time, as early as 19 March," Marte Sofie Danielsen said.

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