According to Manolin’s industry data, salmon farm production ratios have decreased throughout Norway over the past five years.
With production ratio as a calculation of how much each farm is able to produce on their allocated biomass, the data shows that farms are becoming less efficient, on average.
Norway is continually developing strategies to improve production outcomes—using larger smolt and focusing on better breeding, for example—yet improvement is still needed. A number of variables contribute to this, but rising production cost, increasing regulatory pressure, and declining fish welfare in recent years mean the odds are stacked against farmers.
It’s clear that Norway needs to reexamine its regulations and systems to better support sustainable growth in the aquaculture industry.
If the country hopes to meet its ambitious goals of increasing salmon production five-fold by 2050, its approach must change.
Rising production cost
Fisheries, aquaculture and food research institute Nofima reported in 2019 that “it is becoming increasingly expensive to farm salmon” in Norway.
Production costs in the Norwegian aquaculture industry rose by around 50 percent from 2012 to 2016, according to Nofima, and have continued to increase since. Sea lice treatments are among the biggest culprits of this increase, along with the rising cost of fish feed and global economic inflation.
Lice prevention also means lost income. In a December 2019 report, Nofima and analyst group Kontali estimated that slaughtering 1 million fish early costs a farm an additional NOK 30 million to NOK 45 million ($3.4 million-$5.2 million/€2.8 million - €4.3 million). Diseases like PD are estimated to cost the industry another NOK 1 billion to NOK 6 billion ($116 million-$698 million/€95 million/€570 million) per year.
Each of these factors can increase susceptibility to another, though, so accurately estimating the impact becomes difficult.
The true cost of lice and disease for farmers and the industry at large is continuing to grow, even as management practices become more strategic. For small producers, rising production costs put a strain on resources and their ability to invest in long-term strategies.
Declining fish welfare
In addition to running their businesses and keeping fish healthy, farmers must juggle compliance with nine regulatory acts, six departments, and six government agencies as well as county municipalities. Regulatory pressure to keep sea lice under control, specifically, is clearly impacting fish welfare.
Chemical bath treatments tend to be expensive and wrought with human and environmental health concerns. Meanwhile, as Salmon Group’s "Fish Welfare in Fish Farming" report noted recently, cleaner fish have a high mortality rate and frequent disease outbreaks, indicating a struggle to adapt to net-pen environments. So farmers are having to rely more on mechanical treatment options, as Manolin’s data showed last month, which put fish at an increased risk of injury and disease.
According to the Norwegian Veterinary Institute’s 2019 fish health report, almost 53 million salmon fish died in the cages last year, around 16 percent of the stock. The institute’s survey of fish health professionals found that injuries after de-licing were the main reason for reduced fish welfare.
A study in Marine Policy this year also noted that more frequent de-licing measures to keep sea lice below the legal limit in Norway have led to salmon welfare problems and higher mortality rates.
Strict limitations mean that even when a farmer knows fish will be harvested in a few days, he or she may be forced to treat against lice anyway to meet requirements.
As Salmon Group notes, “fish are caused unnecessary pain and suffering simply to comply with rigid regulations ... short-term solutions do not benefit neither the industry nor the fish in the long term.”
The industry needs to continue evolving as new tools and findings emerge. While the traffic light system has effectively kept lice numbers down, it is a singular metric of success; the country now has the data to dynamically measure fish health across productions.
These new depths of data and incredible strides in research are opening new paths forward. This can give farmers the flexibility to do what’s best for their fish—benefiting long-term fish, farm, and environmental health, not just next week’s lice levels.
For Norway to maintain its status as a global leader in sustainable aquaculture—and prevent production cost and fish welfare pressures from getting worse—government, research, and industry need to act as one well-oiled machine. The abundance of experience and ideas between these players can facilitate the real-world application of research, test unconventional collaborations, or follow trends from the cage-level to industry-wide. Most importantly, this can all be backed by numbers.
History has shown the industry is not immune to downturns. If these trends are building among the Norwegian salmon giants, one of its most profitable and successful sectors, it's a sign of difficulties ahead for aquaculture as a whole. The future of the industry is in learning from its deep wellspring of data and experience to quickly iterate and improve.
Tony Chen is the CEO of Bergen, Norway-based Manolin.