Concern among Chilean industry players is growing as a steep drop in prices, mainly reflecting economic deterioration and a shift in retailer sourcing strategies in major markets, saw aquaculture companies incur substantial losses in 2015, said Globefish.
Two fundamental factors underlying the erratic profitability of the Chilean salmon farming sector is high pen density, increasing disease incidence and hence the need for antibiotics, and a general lack of consolidation.
The industry is now looking to regulators to address these issues before sustainable growth can be achieved.
espite the appreciation of the dollar against the Chilean peso (a factor that has benefited the Chilean export industry), low sale prices of salmon, coupled with high production costs, led to very poor performance for the industry for 2015.
The decision by major US retailer Costco Wholesale in March to switch to Norway for two thirds of its fresh farmed salmon filet supplies was a significant blow too.
According to preliminary figures from Sernapesca, during the first nine months of 2015, some 257,607 tonnes of Atlantic salmon were har ested, 43.5 per cent less than the same period in 2014.
Prices are expected to reach a turning point in 2016, however. Supply should not grow higher than levels forecasted and towards the end of the year, supplies of Atlantic salmon are expected to tighten. As a result, there could be some strengthening of prices, especially if the price growth for Norwegian salmon continues.
Given the continuous demand increase in the main global markets, along with the recovery of purchasing power and the levelling of the exchange rate of their currencies, the level of prices could perhaps return to more attractive levels. ,owener, in order for Chile to build back to its competitive global position, consolidation, regulatory revision and brand building will all need to be undertaken.