Norway did it again: seafood export value up 22% in Q1 2023

However, the Norwegian Seafood Council warns that behind the numbers, the picture is not as so positive. Export value rises, but the volume of key species such as salmon and cod falls.
Norwegian Salmon at the supermarket in South Korea. Photo: Norwegian Seafood Council.
Norwegian Salmon at the supermarket in South Korea. Photo: Norwegian Seafood Council.

The value of seafood exports in Norway grew up by 22% in Q1 2023. With once again historic figures, according to the new report from the Norwegian Seafood Council (NSC), the Nordic country exported seafood products worth NOK 41.4 billion, NOK 7.4 billion more than in the same period last year. A positive figure that, however, hides behind it a situation that is more worrying than it might seem.

As in January and February, in March and consequently in the whole of Q1 2003, the situation for Norwegian seafood exports could be summarized as value up, volume down. A weak Norwegian krone, strong food inflation and price growth in the main species markets are the main explanation for this value growth. However, the fact that this price increase is mainly explained by falling export volumes is not good news. A total of 693,400 tons of seafood products were exported in the first quarter, 8.7% less than last year.

Export value in March, the highest ever in a single month

"Norwegian seafood exports have come through a historically strong quarter in terms of value. A significantly weaker Norwegian krone and price growth in the markets for species such as salmon, cod, trout, pollock and herring is the main explanation for the growth", said Christian Chramer, Managing Director of the Norwegian Seafood Council. "This led, among other things, to the export value in March being the highest ever in a single month", he explained.

However, Chramer also issued a warning. "Many value records have been set in the first quarter, for example for salmon and in the whitefish category, but when we look behind the numbers, the picture is not as so positive. Strong food inflation and the weak krone explain a large part of the increase in value, and in addition the export volume of cod and salmon is falling, which helps to raise prices".

For another month, the NSC CEO again reminded that all this is taking place in a tremendously challenging global economic landscape. "World trade will also be affected in 2023 by war and turmoil in the world economy, so we are still living in challenging times. This is felt keenly in the markets, where consumers are now experiencing that their purchasing power has been substantially weakened", he remarked.

In this first quarter of 2023, Poland, the United States, and Denmark were the main export markets for Norwegian seafood products. However, in terms of export value, the U.S. was again the fastest growing. It was NOK 1 billion, up 40% from last year. A rise driven mainly by salmon, but also by trout and frozen snow crab, which also had a strong first quarter. It is also noteworthy that, in their case, the export volume did not decline, but remained at 30,000 tons, the same as in the same quarter last year.

Christian Chramer, CEO of the Norwegian Seafood Council. Photo: Norwegian Seafood Council.

Salmon: price rises, but export volumes fall

While the volume of all seafood exports decreased by 8.7% in Q1 compared to the same period last year, for salmon the decrease was 6%. "In the short term, this has helped to lift prices to historical highs", said Christian Chramer. In total, Norway exported 263,600 tons of salmon worth NOK 28.8 billion in the first three months of the year, NOK 5600 million, 24%, more than in Q1 2022. If we talk only about March, 93,700 tons of salmon worth NOK 11.3 billion were exported, an increase in value of 34% (NOK 2900 million), but a 4% drop in volume.

At the beginning of the year, the largest markets for Norwegian salmon were Poland, the U.S. and France. In the specific case of the U.S., the increase in export value was 53% (NOK 988 million), while, contrary to the general trend, the volume ended at 19,000 tons, 18% more than in the same quarter last year.

"A weakening global supply of salmon, growth in demand coupled with a strong dollar are the explanations for the explosive growth in our exports to the US", said Paul T. Aandahl, Seafood Analyst with the Norwegian Seafood Council. In the North American country, there is still a trend towards higher consumption in restaurants after the crown pandemic, while domestic consumption also remains at a high level. "For home consumption, we are seeing a shift towards more processed products, such as ready meals. Poke bowl is a menu concept that has seen strong growth in recent years", Aandahl explained.

Meanwhile, fresh salmon fillets reached record prices of NOK 148 per kg. This is NOK 23 more than the previous record quarter, which corresponded to the second quarter of 2022. Regarding fresh whole salmon, it also set record price highs at NOK 105 per kg, NOK 7 more than the previous record quarter, which was also in the Q2 of 2022.

Cod: despite everything, a record quarter for skrei

The other species that saw an increase in export value due to a decrease in market volume, was cod. Norway exported 22,800 tons of fresh cod worth NOK 1.4 billion in the first quarter, 8% more than last year. However, export volume fell by 12%. Continued bad weather and late frosts contributed to significantly lower landings of fresh cod compared to last year, especially in January and February. "Together with a weak Norwegian krone and high price growth in the markets, this resulted in a historically high export value for fresh cod in the first quarter. NOK 97 million higher than the previous best quarter", explained Eivind Hestvik Brækkan, Seafood Analyst with the NSC.

Denmark, the Netherlands and Spain were its main markets for fresh cod this Q1 which, despite lower quotas, bad weather and a late skrei season, was notable for the high export value of fresh whole skrei. "Despite a significant decrease in landings of fresh cod, the export volume of skrei fell by only 6 per cent in the first quarter", continued Eivind Hestvik Brækkan. "In March, when the landings of fresh cod picked up again, we saw volume growth for the export of skrei of as much as 22 per cent, to a total of 1,700 tonnes".

The Norwegian Seafood Council report specifically highlights the Spanish case. "Norwegian fresh cod and skrei continue to strengthen their position in Spain. Even though the domestic consumption of seafood in Spain has decreased by 10% so far this year, the export of fresh cod from Norway is increasing", said Bjørn-Erik Stabell, the Norwegian Seafood Council's envoy to Spain.

In the first quarter, skrei achieved a record price of NOK 69 per kg, NOK 15 per kg more than the previous record quarter, Q1 2022. The price of fresh cod fillet was NOK 127 per kg, NOK 6 per kg higher than the previous record quarter, Q4 2022. Fresh whole cod also achieved high prices at NOK 56 per kg, NOK 2 per kg higher than the previous record quarter, also Q4 2022. Meanwhile, farmed cod exports increased by a solid 81 % to a total of 3,000 tons. It accounted for 13% of the total export volume of Norwegian fresh cod in the first three months of the year.

Skrei, one of the species in Norwegian seafood exports with an increase in value in Q1 2023. Photo: Norwegian Seafood Council.

Other species: trout, herring, mackerel, crab, and shrimp

Regarding the rest of the species, in this first quarter, the NSC highlights trout, which achieved historically high prices for both trout fillets (NOK 143 per kg) and fresh whole trout (NOK 108 per kg). This caused its export value to increase by 18%, NOK 169 million out of the total NOK 1.1 billion achieved in this Q1. Norway exported 10,200 tons of trout although, as with salmon and cod, export volumes fell here too, by 12% in this case. The United States, Thailand, and Lithuania were the largest markets for trout in the first quarter.

As far as herring and mackerel are concerned, one country stands out that we don't usually see in the Norwegian Seafood Council report. Egypt was the largest export market for herring. The Middle Eastern country has state-of-the-art smokehouses where herring and mackerel are smoked, and higher quality herring and mackerel are now more in demand than ever before. In fact, Q1 2023 was also a record quarter for mackerel, which saw a 16% increase in exports thanks to, among other things, increased direct imports from Japan, bypassing China for processing.

Another species that has registered an increase in export volume in this Q1 is king crab. Live king crab increased by 30% to 375 tons, while the volume of frozen king crab increased by 2% to a total of 110 tons. However, contrary to what we have seen in other species, for king crab the export price fell (13% lower for live and 25% lower for frozen) compared to last year's record prices. There was also strong growth for snow crab. A total of 2,800 tons were exported (197% more than last year) for a value of NOK 296 million (46% more).

Shrimp also experienced a strong quarter. Norway exported 4,100 tons with a value of NOK 274 million. This means that, compared to Q1 2022, the value of prawn exports increased NOK 67 million (32 %), while the export volume grew by 48 %, 1,321 tonnes more. Not since 2008 had more than 4,000 tons of shrimp been exported in the first three months of the year. Increased catches in the Barents Sea, together with higher prices for frozen peeled shrimp and frozen cooked shrimp, combined with a weakened krona, have contributed to this.

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