Passing the test

Salmar Fillets

It’s been a challenging year for the world’s second biggest salmon farmer but, the CEO says, it has come through with flying colours. Vince McDonagh reports

Salmar is not just one of the world’s largest Atlantic salmon farming companies – it is also arguably the most interesting.

In little more than 30 years, it has grown from a small coastal operation on the island of Frøya in central Norway to become a global giant, second only to Mowi. Pundits are predicting it could overtake Mowi within a decade.

Fish processing SalMar

Fish processing

That’s for the future. It is the present that matters now, and 2023 has probably been the group’s most challenging year to date, not only because of jellyfish and other issues, but because of the challenge of sorting out the various NTS group businesses it acquired some months earlier.

They included proud and influential names such as Norway Royal Salmon and SalmoNor. Integrating them into SalMar’s corporate culture was not going to be easy.

SalMar believes that, thanks to what its annual report calls the tireless efforts of its staff, it has passed that test.

Frode Arntsen

Frode Arntsen

Chief Executive Frode Arntsen said in the company annual report that, even more important than cost synergies, are the additional value creation and increased competitiveness already achieved which now bode well for the future.

“But we cannot rest content with previous successes,” he said. “The aquaculture industry must address the challenges facing it and pursue improvements in all areas – especially with respect to the environment and fish welfare.

“At the same time, we can be proud that Norwegian aquaculture scores highly in terms of sustainability compared to other food producers worldwide.”

Had it not been for the “pearl norman” jellyfish (also known as “string jellyfish”) scourge, which also affected Scottish and other Norwegian producers, SalMar would have enjoyed a better 2023.

Group turnover was NOK 28.2bn (£2bn) against NOK 20bn (£1.5bn) a year earlier. The operating profit came close to doubling at NOK 8.5bn (£625m).

It also had the honour of being named one of the world’s most sustainable protein producers by FAIRR in 2023.

But the CEO said he must acknowledge that some aspects are also moving in the wrong direction.

Arntsen said: “Fish mortality is increasing. Fish welfare is more challenging. It is our responsibility to change that. We must realise that there are simply too many gaps in our knowledge. We need to know more about the salmon which is the most important part of our value chain.”

SalMar workboat

SalMar workboat

Yet despite the jellyfish problem, SalMar also had significantly lower salmon mortality in 2023 than the industry average.

The CEO went on: “But still, we must adhere to SalMar’s important rule that everything we do today must be done better than yesterday.”

The company says jellyfish are one of several risk factors in fish farming, but they rarely cause significant damage to the fish, as was the case in this instance.

Fortunately, it has contingency plans that account for such events, and the company has, in collaboration with the Norwegian Food Safety Authority, taken measures based on fish health assessments.

The consequence of the jellyfish attack was a significant outtake of fish, reducing SalMar’s estimated volume harvested in Norway in 2024 by 20,000 tonnes, to a total of 237,000 tonnes.

Meanwhile, SalMar is placing great hopes on its Salmon Living Laboratory project with Cargill which it believes will become a major centre for innovation, research and development.

SalMar processing plant

SalMar processing plant

“Our ambition is for this knowledge centre to become a valuable contribution to sustainable growth in the aquaculture industry, “ said Arntsen.

“Our ambition is for this knowledge centre to become a valuable contribution to sustainable growth in the aquaculture industry. It is with great pleasure that SalMar launches this initiative in partnership with Cargill, one of the world’s leading food producers and a global spearhead in the research, development and production of nutritious fish feed and feed ingredients.”

Looking ahead, the SalMar chief said geopolitical challenges presented one of the main uncertainties.

“Wars both inside and outside Europe are continuing to leave their brutal mark on everyday life around the world.

“The solutions to these challenges will lie with the governments of the states concerned and the international community.

“Let us hope that the peace ambitions that laid the foundations for the UN eventually gain the upper hand.

“The Norwegian aquaculture industry also has a role as a bridge-builder between people and nations.

“This takes place through constructive cooperation with companies and customers worldwide and the industry’s contribution to a sustainable global food supply.”

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