Yesterday, health authorities confirmed two people had died from listeriosis and Tasmanian salmon was blamed.

Listeriosis is an illness containing a bacteria called listeria monocytogenes and it is rare, occuring usually in raw and chilled food, but can be fatal especially to people with poorer immune systoms.

Two ASX companies produce salmon in Tasmania – Tassal (ASX: TGR) and Huon Aquaculture (ASX: HUO). These companies are also Tasmania’s two largest producers, owning 50 per cent of the market between them.

Tasmanian Minister for Primary Industries and Water, Guy Barnett, said, he “won’t go into those details. That is obviously a very important matter.

“What I will say is the Department of Primary Industries has investigated the matter.

“There has been no breach of the law, in terms of food safety and the production of salmon in Tasmania.”

Premier Will Hodgman made a similar statement today saying Tasmania’s salmon producers had been cleared of food safety standards.

Today Huon is down 3 per cent while Tassal is up 1 per cent. Overall this year Huon is flat while Tassal has gained 17 per cent.

Earnings season is coming…

Tassal’s most recent financial results were its half yearly figures in February which it deemed its best ever. Its net profit after tax was $31.7 million.

In February, Goldman Sachs tipped the stock a buy with a $4.50 price target. Analyst Michael Peet said “medium term supply demand dynamics look good for domestic and international Atlantic Salmon”.

“Supply is struggling to keep up with demand in Australia and international markets, supporting a positive price outlook for the foreseeable future.”

Morgans, however, has rated the stock a hold this week with a price target of $5.10.

Similarly Huon has been rated as a Hold by Bell Potter, Credit Suisse and Goldman Sachs; although Shaw and Partners rated it as a buy.

Huon delivered a similarly large net profit after tax of $26.4 million. However in May it cut harvest tonnage by 5 per cent and cut earnings before tax from $64-$68 million to $50-$55 million.

Huon blamed warmer sea temperatures and an earlier jellyfish attack which had an impact greater than it first anticipated. Michael Peet said this was “disappointing but not totally unexpected”.