Norwegian salmon farmers’ share prices take hit after price-fixing allegations

The share prices of some of the top publicly traded salmon-farming companies in Norway dropped sharply after the European Commission informed them it was advancing an investigation into price fixing in the salmon spot market.

The E.C. alleged that Mowi, Cermaq, Grieg, Bremnes, Lerøy, and SalMar all breached European Union antitrust rules and colluded to influence prices on the spot sales of Norwegian-farmed Atlantic salmon. The allegations stem from a multi-year effort by the E.U., starting with an investigation in February 2019.

Soon after the new allegations, the shares of the publicly traded companies on the list – Mowi, Grieg, Lerøy, and SalMar – dropped sharply. Cermaq was publicly traded until it was acquired by the Mitsubishi Corporation in 2014, and Bremnes Seashore is a privately owned company.

Shares of Mowi dropped sharply soon after the European Commission publicly announced it had informed the Norwegian salmon producers about its preliminary view that they had breached E.U. antitrust guidelines. According to Euronext Live Markets, its share price went from an opening price of NOK 194 (USD 18.62, EUR 17.14) to a brief dip below NOK 182 (USD 17.46, EUR 16.08) at 12:00 GMT – just 20 minutes after the announcement – before restabilizing and closing at roughly NOK 186 (USD 17.85, EUR 16.44), a drop of slightly over 4 percent. 

The share price for Grieg Seafood dropped at the same time as Mowi’s share price, dipping over 5 percent from roughly NOK 69 (USD 6.62, EUR 6.09) at opening to closing at NOK 65.4 (USD 6.27, EUR 5.78) on 25 January – the day of the announcement.

Lerøy Seafood Group saw a similar pattern. The stock price was trending upward at the start of the day, reaching a high of slightly over NOK 44 (USD 4.22, EUR 3.88), before it dropped to NOK 41.74 (USD 4.00, EUR 3.68) by closing – a drop of 5 percent.

SalMar saw the biggest drop in value in monetary terms but the smallest impact by percentage. The company’s stock opened the day with a share price of NOK 595 (USD 57.11, EUR 52.60) and opened the next day at NOK 576.60 (USD 55.34, EUR 50.97) – a drop of 3 percent.

Bloomberg reported that the news may have prompted a selloff of kroner, as foreign investors transferred some funds out of Norway.

If the companies are found to have colluded on price, each face a fine of up to 10 percent of the company’s annual worldwide turnover. Given Mowi’s revenue reached EUR 4.9 billion (USD 5.3 billion) in FY 2022, a 10 percent fine would cost the company EUR 490 million (USD 530 million).

Photo courtesy of Mowi