Isles' salmon plant's future in doubt – Fishupdate.com

Isles’ salmon plant’s future in doubt Published:  27 January, 2007

A SENIOR manager with Marine Harvest, now the world’s largest aquaculture company, has declined to clarify the future of the salmon processing plant in Stornoway in the Western Isles.

There is concern that the plant, formerly owned by Fjord Seafood Scotland, which is part of the three-way merger with Marine Harvest and Pan Fish, could be closed with the loss of around 60 full time jobs. Western Isles Council representatives had a positive meeting with the chief executive of Marine Harvest, Atle Eide last week, but he made clear that he was concerned at the high cost of transporting processed fish from the Western Isles to the mainland. Marine Harvest is holding an extraordinary general meeting in Stavanger to get shareholders’ agreement to the direction the new company will take.

Marine Harvest is now the world’s largest aquaculture company with an expected harvest volume of about 430,000 tonnes of salmon and trout products in 2007 in about 20 countries. The company also produces halibut, cod and yellowtail. In addition to fillet production and further processing in Norway, Scotland, Ireland, Chile and Canada, the company has extended secondary processing facilities in USA, France, Belgium, Poland and the Netherlands. The new company will have about 9,000 employees world-wide.

The company was forced by the French competition authorities to divest itself of Pan Fish Scotland, which will now operate as a stand-alone company, which is already attracting the interest of potential buyers. The concern in the Highlands is that the merger will lead to job losses on the salmon sea farms, and that with Marine Harvest having closed its own factory in Stornoway in 2003, and Stolt Sea Farms’ state-of-the-art factory in Scalpay in 2005, the remaining processing factory in Stornoway is in a precarious position.

Mr Steve Bracken, technical development manager with Marine Harvest in Scotland, said that the Scottish operation had to become more competitive. Atle Eide has already made it clear that production costs in Scotland exceed those in Chile and Norway and he has asked the Scottish Executive and Highlands and Islands Enterprise to consider what help they can give the industry to make it more cost-effective. Mr Bracken said: “In Scotland, the job we have on hand is to become more competitive with Norway and Chile. Scotland is the third largest producer of salmon in the world, but we’re also the most expensive out of the three. We have to look at our costs and see how we can become better and more efficient. We have to look at every aspect of the business, whether that’s employment or mechanisation, the whole range has to be looked at.”

He added: “We need to become more competitive and reducing costs is how we get there, we have to look at every aspect of the business. I can’t make any comment on the processing factory in Stornoway at the moment, I’m afraid. It’s still very early days but we’re looking at the strengths and weaknesses of both Fjord Seafood and Marine Harvest and putting those together and seeing what’s best. This is a big business and these things take time from past experience, but I would be confident that the merger would be completed by the middle of the year.”

Representatives from Western Isles Council met Atle Eide last week. Vice convener Angus Campbell said: “We had a good meeting and Mr Eide mentioned a lot of positive aspects about the operation of the two companies in the Western Isles. But what he did highlight to us was that transport costs are very high. He emphasised that transport must be made more cost-effective, and that concerns us very much. He said that a decision on the future direction of the company’s Scottish operations could be made in the next few weeks.”

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