Aquaculture: Meal and oil yield best profits

Producers of fishmeal and oil achieved the best profitability in the Norwegian fishing industry in 2006, Fiskeriforskning's annual profitability study of the Norwegian fishing industry shows.

Stockfish production claimed second place last year. The annual Profitability Study shows the overall result for the Norwegian fishing industry in 2006 was similar to that for 2005.

However, there are clear differences in profitability between the various sectors.

Production of fishmeal and fish oil was much more profitable due to higher prices for the products. This sector recorded its best result last year since 1997, with a profit of more than NOK 200 million.

The other sectors of the fishing industry producing for consumption had a decline in profitability. The pre-tax profit was 60 percent down - from NOK 300 million to less than NOK 150 million.

Financial costs cause reduction

"Above all, higher financial costs reduced the result," says Scientist Bjørn Inge Bendiksen. Large losses for companies processing herring and mackerel were also a major contributing factor to this decline.

Despite this, 55 percent of companies in the consumption industry recorded a pre-tax profit, as in 2005.

Profitable stockfish

Stockfish producers in Lofoten recorded significantly higher profits last year than in 2005.

"Better drying conditions and better quality of stockfish are the main explanations for the good result recorded by many producers."

In the clipfish industry, the most important part of the Norwegian whitefish industry in both output and value, profitability fell in 2006. Increased production and higher prices were insufficient to compensate for the rising price of raw materials.

Better for the fillet industry

On the contrary, there was progress for the saltfish industry, but a large proportion of the companies are still struggling with low profitability.

Profitability for companies in the fillet industry processing cod, saithe and haddock again improved. Although collectively they recorded a profit, half the companies still ran at a loss.

"Better profitability in the fillet industry can largely be put down to reducing production of frozen fillet and switching production to fresh fillet products," says Bendiksen.

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Aquaculture: Meal and oil yield best profits