Tassal Group Strategic Thoughts, page-212

All that effort of forecasting the dollars and cents of export prices.. as Bug noted, not sure it will add a lot to the investment thesis.

Meanwhile the Aussie Peso is getting punched squarely in the nads thanks to the collapse of iron ore. AUDUSD dropped from 75c to 71c this month. Smiilar with the RMB, dropping from 4.81 to 4.55. While we track the NOK, I don't believe we trade in that currency. Tassal does hedge major spot-price contracts on up to 2 month basis, but mostly they are at the whims of FOREX movements. So our effective export price has just jumped by like 5% on top of the increasing salmon NOK price rise of 4.3%.

This is an excerpt on the forex hedging from the annual report:



Meanwhile the Norwegian salmon producers are also getting smashed. This is Bakkafrost one of the higher quality companies, down 25% in the past month. You can look at Mowi, Leroy, etc they're all around 20-25% down. Three reasons I think for this: 1) they ran up hard, and much harder than Tassal did; 2) Covid-Omnicron and potential impacts on salmon demand; and 3) they're forecasting lower volumes into FY22 and for demand to exceed supply for next five years. Good for those who can meet the demand, but if their volume is dropping that's not great - for them, great for us.