June 1, 2018 / 12:59 PM / in 6 months

UPDATE 1-Norwegian salmon price seen down another 13-14 pct next week

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OSLO, June 1 (Reuters) - The price of Norway’s farmed salmon is expected to fall to about 55 Norwegian crowns ($6.75) per kilo next week for deliveries in Oslo from 63-64 crowns per kilo this week, a drop of 13-14 percent, two industry sources told Reuters on Friday.

Initially, prices for this week were expected to drop 10-15 crowns to a range of 65 to 70 crowns, but in the end fell even more, the sources said.

Growing volumes of fish in the market and a backlash against a recent high cost, have combined to drive down prices, the sources said.

“It’s a significant price drop. We expect prices in the mid-50s next week,” said a producer who declined to be named.

“It’s more fish, and also pay-back time after a period of record high prices,” he added.

Unseasonably warm weather in May has helped the fish grow more rapidly than during the colder months of the year, contributing to the higher supply.

Some exporters last week bought fish at 69 crowns per kilo but were forced to sell at a loss when the overall market price plunged, the sources said.

A drop of some 25 crowns per kilo in the last 10 days or so constituted the largest fall ever recorded, said one exporter.

In late January, the price of salmon stood at around 50 crowns per kilo, on fears of strong supply growth, but a cold Norwegian winter instead resulted in slower growth in fish stocks, giving a new price spike before the most recent drop.

Norway is the world’s top salmon exporter, with fish farming the Nordic country’s second-largest export industry after oil and gas production. 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. Their shares were down from 1.3 to 4.2 percent on Friday. ($1 = 8.1532 Norwegian crowns) (Reporting By Ole Petter Skonnord, editing by Terje Solsvik)

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