Leading wholesaler expects salmon prices to fall in coming months

Iceland Seafood International (ISI) has reported a good start to 2024 after a difficult time last year. It expects to see sales volumes increasing as salmon prices fall.

The company, which withdrew from UK production after selling its Grimsby seafood site, said profits almost doubled during the first quarter despite lower sales. It is a major supplier of salmon to the retail trade.

The 2024 Q1 normalised profit totalled €1.9m (£1.6m) against €1m (£862,000) a year ago.

Sales, however, were down by 8% at €113.8m (£98m). The company said the early Easter this year had an impact on revenues.

The company said that higher than expected salmon prices impacted sales volume during the quarter.

“These increases in salmon prices caused similar challenges as in the same period last year, as it takes time to push cost increases through to customers.”

The company added: “Based on the Q1 results and current trading, the normalised PBT [profit before tax) Outlook range for 2024 is maintained at €5.0m to €7.0m.

“The outlook for our main species is that cod prices will remain high until fall, while salmon prices will come down in Q2 and remain stable throughout the year.

“There are signs indicating a more balanced external environment. We expect all divisions to perform according to budget and do not foresee huge changes in the seafood sector in the coming months.”

CEO Ægir Páll Friðbertsson said: “The first quarter of 2024 is more in line with what we have previously seen as normal conditions in the white fish markets.

“The start of the year in white fish gives a positive sign for the rest of the year. However, salmon prices were higher in the first quarter than forecasts had assumed, and therefore, there was a loss in salmon activity as it was in 1Q the two previous years.

“If the forecasts for salmon prices are met, prices should decrease in the third quarter.”

He added: “After a difficult 2023 due to the burden of our UK (Grimsby) operation and challenging external environment, this is a welcome sign in markets for white fish, a step in the right direction.

“We at Iceland Seafood will build on and keep in mind that economic forecasts indicate, the economic environment of the company’s main trading countries is still and will remain uncertain.”