Continued strong performance in Norwegian aquaculture despite challenges

Record-high salmon prices and strategic investments drive unprecedented growth in Norway's aquaculture sector.

In brief

• Norwegian aquaculture achieved record revenues last year due to high salmon prices and favorable exchange rates.
• Technical solutions and biotechnology segments are driving future growth and sustainability.
• The introduction of the resource rent tax led to structural changes and strategic adaptations within the industry.

For the second consecutive year, the Norwegian aquaculture industry achieved an all-time high revenue, thanks to a combination of record-high salmon prices and a favorable EUR/NOK exchange for exporters. This led to significant gains in the trading segment. However, despite the revenue increase, EBITDA margins in the production segment declined due to slightly lower production volumes and higher production costs per kilogram.

In 2023 and 2024, there was notable deal activity within the technical solutions segment, with many transactions involving companies in this area. Financial investors showed increased interest, while strategic investors continued to leverage mergers and acquisitions to expand their market presence and product portfolios.

The biotechnology segment saw strong growth, driven by high demand for new vaccines and improved margins in the feed and fish health subsegments. This growth was supported by external pressures to enhance fish welfare, particularly in the genetics portion of the segment.

The salmon farming sector continued to thrive, achieving unprecedented revenue primarily due to high salmon prices. Despite a slight decline in harvest volume, the high prices more than compensated for the reduced volume. However, total EBITDA was impacted by increased costs of goods sold and other operating expenses. 

The distribution segment experienced a significant recovery, with trading companies achieving all-time high revenues. This recovery was driven by high salmon prices, a weak NOK relative to the EUR, and increased exposure to spot prices among companies.

Land-based farming projects have shown growth, with several companies reporting successful harvests. These projects could help bridge the current supply gap in the industry, though their long-term viability remains uncertain.

Aquaculture is still in the early stages of digitalization, with many operations relying on manual processes. However, the digital age presents a significant opportunity for the sector to develop and implement new solutions tailored to its unique challenges. Artificial intelligence (AI) and operational production technologies are seen as the next steps for aquaculture, driving improvements in fish welfare and sustainability.

The introduction of the resource rent tax in 2023 posed significant challenges for the industry. Designed to ensure that economic benefits from natural resources are shared with the community, this tax led to higher production costs and slowed investment. In response, many companies restructured their operations to adapt to the new tax regime. Major farming companies transferred their biomass and licenses to separate entities, creating "pure play" entities for operations subject to the tax. This restructuring aimed to optimize tax liabilities and maintain profitability under the new tax conditions. 

Norway’s unique environmental and climatic conditions have made aquaculture a strong pillar of the economy. However, these same factors also expose the industry to climate risks. Rising temperatures and environmental changes pose significant threats to the entire value chain, from supply chains to operations. Public and regulatory pressure is mounting for companies to assess and report climate-related risks — a crucial step toward developing effective mitigation strategies.