Joar Grindheim
August 19. 2009
For the ninth consecutive year, IntraFish is presenting its overview of the 30 biggest salmon producers in the world. The companies are ranked according to volume of Atlantic salmon, trout, coho and king salmon slaughtered in 2008, converted to round, bled weight (WFE). Where possible, IntraFish has included the financial result for individual companies.
As usual Norwegian and Chilean companies dominate the list, but other companies are also distinguishing themselves.. However, the four biggest companies produce almost as much as the other 26 put together. There are a handful of gigantic companies, slightly more of the medium-sized and some that are “small” in comparison, but are still big in a global perspective.
In recent times, the biggest companies have expanded and are increasing production every year. That won’t be the trend in the future largely because of the ISA disaster that has struck Chile.
The downturn here is likely to be at least 60-70 percent, a percentage that changes constantly with each turn of the tide. This year, there will be a decline in production of farmed Atlantic salmon on a global basis, as no other marine farming nations are capable of filling Chile’s lost production.
Strong demand for salmon in 2009, has led to excellent salmon prices; 2009 will go down in the history books as one of the best financial years ever for salmon producers who managed to avoid disease and other problems.
Volume started to decline for the world’s biggest salmon production company Marine Harvest in 2008. At that time the decline was just 4 percent.
This year, the downturn has increased to more than 9 percent. Marine Harvest is not alone in experiencing a significant reduction in volume in 2009.
The biggest company in Chile, Aqua Chile, expects its production volume to fall 60 percent compared with last year. Production volume for other companies in Chile will also be reduced at least as much.
Salmon farming has become a major industry, which possibly explains why more and more companies have chosen to go public, while others have plans to do the same.
This trend started several years ago, and in 2007 a number of salmon companies in Norway and Chile debuted on the stock exchange. Collecting capital from external investors to finance growth is a trend more will follow, even though in 2008 no new salmon companies were listed on any stock exchange.
The global finance crisis can also be blamed for some companies holding off public stock offerings, bearing in mind the plunge in value experienced by so many companies last year.
But with banks more cautious these days, the only way to finance growth and development is to attract new investors, especially in Chile, where the need for capital will be extreme in the next few years as the salmon industry is rebuilt.
Last year was a year with more acquisitions and consolidation. The most noteworthy single event was Austevoll Seafood’s stock exchange raid on Leroy Seafood Group.
Several salmon production licenses have also changed hands, and restructuring is taking place throughout the Chilean salmon industry.
In Norway, 65 new licenses are to be dealt out this year for production of salmon and trout. Political signals indicate more new licenses will be made available in the future.
Controlling the environment where fish are to grow is a massive undertaking, a challenge both Norwegian and Chilean producers are aware of every day. As in 2007, it was also clear in 2008 that the aquaculture industry battled with various diseases that led to major financial losses.
ISA is biggest in Chile, but there are also outbreaks in Norway and Scotland. In Southern Norway, producers have been combating PD. Salmon lice is a problem with which the industry is also dealing.
At the same time, marine farming impacts the surrounding environment in ways othern than disease and salmon lice.
The industry is under constant pressure from environmental organizations and other interests.
The word sustainability is gaining in importance for many consumers.
SalMar, for instance, is one of the companies that have applied for ecological production licenses in this year’s license allocation round in Norway.
It seems clear, more companies wish to be associated with sustainable production.
For more information about this newest IntraFish Media Industry Report or to order your copy of the report, please e-mail info@intrafish.com .
This report is only available in English.
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