Challenges in Scotland dampened record earnings for Bakkafrost

Bakkafrost earned 587 million DKK (€79 million), somewhat lower than the analysts’ estimate of 608 million DKK (€81.8 million), in the second quarter of the year.

The Faroese farming company harvested 19,700 tonnes of salmon (gutted weight) in the quarter.

“We are satisfied with the results in this quarter. We are particularly pleased with the strong biological performance in the Faroe Islands, where we had the lowest salmon lice level in eight years, low mortality and strong growth. We have also made significant progress in our large smolt strategy, learning from our experience over the past year. Adaptations to the large smolt production have led to further improved smolt quality and robustness,” Bakkafrost CEO Regin Jacobsen said.

“Farming in Scotland has improved compared to previous quarters, but we have had some challenges in one area this quarter. Our investments in new hatcheries for the production of large, high-quality smolt are key to transforming the business in Scotland, and we are well underway with the first of the new hatcheries at Applecross, which will significantly increase smolt production capacity in 2023,” he added.

“The salmon market in this quarter has been characterized by record high prices. We have seen a strong post-Covid comeback from the Horeca market, while global supply has decreased by more than six percent for two quarters in a row. The supply of fresh salmon to the spot market has been further limited by the high proportion of contracts in the industry. In combination with strong demand, this has led to all-time high salmon prices. For the next year at least, supply growth will be low, and we expect moderately strong prices,” Jacobsen noted.

“The salmon industry is also affected by today’s strong inflation on raw materials and energy. Due to the long production time, there is a significant time delay before the increased costs will be fully visible in the finances of the farming companies.”


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