October 23, 2007

Norway's fishmeal and oil producers reap the most profits

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

Overall profitability remained the same as in 2005, the study said.

Production of fishmeal and fish oil became much more profitable in 2006 due to higher prices for the products. This sector saw its best result in nearly a decade, with a profit of more than NOK 200 million (US$36.8 million).

This is in contrast with profitability in the other sectors of the industry, which fell. The pre-tax profit was 60 percent down - from NOK 300 million (US$55.2 million) to less than NOK 150 million (US$27.6 million) as companies got bogged down by high costs.

Large losses for companies processing herring and mackerel were also a major contributing factor to this decline.

Despite this, more than half the companies in the consumption industry recorded a pre-tax profit, as in 2005, the report said.

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.

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, a scientist said.