Salmon Evolution breaks even in Norway, faces cost problems in Korea

Norwegian land-based fish farmer Salmon Evolution has reported that its farming operations broke even for the first time, during the final quarter of last year.

Q3 earnings before interest and tax (EBITDA) for Farming Norway were recorded as NOK 43,000 (just over £3,000) compared with a loss of NOK 9.4m (£706,800) in the same period in 2022. Taking a fair value adjustment into account, however, Farming Norway recorded a loss of NOK 16.7m (£1.25m).

The company recorded a harvest volume of 1,104 tonnes with an average weight of 3.5 kg and a superior share of 90% at its hybrid flow-through site at Indre Harøy, north of Bergen.

Salmon Evolution said there was continued strong biological performance, with good appetite and low mortality across the farm. Standing biomass was recoreded at more than 2,200 tonnes live weight at the end of 2023. There was also an all-time high in terms of biomass production in the final quarter, with 1,439 tonnes in net growth.

Salmon Evolution, which also has interests in South Korea, said operations in Norway represented the first full year of operation. During that period the company stocked six batches of smolt, had a net biomass growth of 3,751 tonnes and harvested 1,874 tonnes (HOG).

The company added: “In Q4 the company enjoyed another quarter of good biological performance, ending the quarter with more than 2,200 tonnes of standing biomass and all-time high biomass growth at 1,439 tonnes.

“The biomass growth in Q4 was impacted by high harvest activity, concentrated in November, temporarily reducing biomass production.

“Additionally, the fourth quarter was used to streamline the two ‘production lines’ at Indre Harøy, leading to a higher-than-normal number fish transfers and starving days.”

“The high activity at Indre Harøy had limited impact on other key parameters. Mortality ended at 1.2 % in the quarter demonstrating that the company is operating within its target of 3-5 % mortality on an annual basis.”

Salmon Evolution plant, Indre Harøy

Salmon Evolution is also planning to expand across the Atlantic big time and said it was currently in advanced negotiations on a high potential site in North America.

The company is involved in a joint salmon facility venture with the South Korean seafood company K Smart Farming. The project consists of a smolt facility at Jeongseon, a grow-out site at Yangyang and certain other infrastructure. At the site for the planned smolt facility at Jeongseon, there has been freshwater trout production for many years. The planned site for the grow-out facility at Yangyang, is located on the northeast coastline of South Korea.

The company has admitted that it currently sees the overall project economics as “challenging”, which it says is primarily driven by site-specific circumstances at the Yangyang grow-out site, in particular related to the intake and discharge water solution due to a relatively long and shallow shoreline at the grow-out site.

Salmon Evolution said it is currently working to secure government financial support to help improve the situation.