The world’s land-based aquaculture projects have had a good run of investment in recent years.
Everyone from incubators to private equity have jumped merrily onto the bandwagon, excited to be part of a revolution in world protein production and protected by a reasonably healthy economy and a new consumer focus on sustainable food.
Norway's high net worth individuals, in particular, cushioned by the luxury of their country's extraordinary wealth, have been drinking the land-based Kool-Aid with abandon in recent years.
Runar Vatne, one of Norway's 400 richest people, through his various companies owns almost 6 percent of land-based groundbreaker Atlantic Sapphire.
Egersund Group, 50 percent shareholder in land-based tech specialist Akva Group, is part-owned by Frode Teigen, the 85th wealthiest individual in Norway.
Ronja Capital, owned by Norway's 149th wealthiest individual, Roger Halsebakk, recently became the largest new investor in land-based Salmon Evolution.
But overnight everything has changed. The coronavirus pandemic has wrought economic devastation and, for once, this destruction is not solely targeted at developing world countries, but at the "financially stable" seafood market giants of the United States, Europe and Japan.
Even Norway, a country seemingly untouchable by market fluctuations and world events, has had its lucrative oily black shield wiped away as crude oil prices and the Norwegian kroner collapse, and is being forced to see the world from a very different perspective.
Jobless figures have rocketed to their highest level since the Second World War, and despite a raft of measures put in place by the Norwegian government, the country’s economy is expected to shrink by 1 percent this year.
So what does this mean for the land-based salmon industry, where Norwegian high-net-worth individuals -- who generally also have stakes in the country's now suffering oil industry -- have been, by far, the biggest investor, both domestically and abroad?
Seafood is a crucial element of the Norwegian economy, but this certainly doesn’t feel like an environment in which you would make a high-risk bet on an early-stage project.
Last week we reported how Norway’s Salmon Evolution, a land-based salmon project in the construction stage, missed the mark on its fund-raising, hitting the bottom end of its projected financial boost and making it unclear as to whether the company would be able to enact its schedule of work in the time and to the scale planned.
And it is, of course, not just impacting Norwegian-funded projects. In Australia, too, land-based aquaculture funding is feeling an immediate pinch, with Seafarms, the company behind Nissui-backed Project Sea Dragon, having to resort to a hasty cash injection from a key stakeholder and company director in order to lure a minimum fund-raising from external investors, and no doubt setting the company off course on a very capital intensive project.
Without wanting to be a purveyor of doom, there is every chance this is the mere tip of the iceberg.
These fund-raisings made their case before the real stomach-churning depredation of the pandemic became evident, and even then, could not conjure enough appetite for their forecasted returns.
That is not to say that land-based aquaculture doesn't have a future. Even after Covid-19 is done eviscerating the world economy, people will still need to eat, and there is definitely an argument to say that local, sustainable production of nutritious, traceable food will be higher on the agenda than ever.
But these are extremely capital intensive projects, with a high risk factor and, with no short-term ability to show any kind of return; they seem likely to be the first to be struck from the investor planning sheet.
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