Global Aquaculture Update 1H 2022: Strong Demand Driven by Covid Recovery

Seafood demand recovery will continue in 1H 2022, supporting prices, provided Omicron does not send the world into prolonged lockdowns.

Main highlights:

Key dynamics: Good demand will support high seafood prices in 1H 2022. Supply for salmon will be tight, but shrimp supply will increase in 1H 2022. High production costs due to freight, feed commodity, labor, and energy costs will be a key theme of 2022.

Demand drivers: Omicron and possible new Covid strains are the key threat to recovering demand. We expect a good demand environment for seafood, if the economic recovery from Covid continues. But new global lockdowns could delay recovery. The US and EU will continue to experience the strong demand growth seen in 2021. China is showing signs of recovery in import demand and should return to pre-pandemic import levels during 2022.

Supply drivers: Costs increased in 2021. Elevated input prices are expected to remain through at least 1H 2022. Salmon supply will be tight and even negative in 1H 2022 due to low production in Norway. Shrimp supply is expected to grow in in 1H 2022, supported by the good price and demand environment. We expect a normal half year in fish meal production, with no El Niño.