Weakening dollar provides for cheaper fish feed.
In line with rapidly rising crude oil prices, the Norwegian kroner has appreciated markedly against the US dollar. On Friday morning, the dollar traded at 8.29 against the Norwegian kroner.
It’s been a long time since the first coronavirus panic sent the dollar skyrocketing. On the 1st of March last year, the dollar stood at 10.40 against the Norwegian kroner.
Since then, the exchange rate has mostly gone down.
This currency effect is clearly being felt in the salmon market.
Both in the sale of whole fish, but also when purchasing fish feed, which is the largest single cost component in aquaculture.
While fish feed is sold in Norwegian kroner to Norwegian fish farmers, purchases of feed ingredients, such as soy, wheat, canola and fish meal, are made largely in dollars. The currency gain on the finished product feed, is divided between feed supplier and fish farmer.
Yesterday’s quarterly report from BioMar stated that the price of fish feed fell in the first three months of the year. The feed price has thus fallen for six straight quarters.
SalmonBusiness has tried, but failed to get a comment from BioMar communications director Kathrine Bryar, about this development.