“It is fair to say the banks still think it is too early to lend to land-based fish farming”

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Banks need to see results before lending money.

“Today we have bank financing for the fish farms in both Fredrikstad, Norway, and Hanstholm, Denmark. We see that if you have a facility that is up and running, the banks are there”, says CEO Bernt-Olav Rottingsnes in Nordic Aquafarms to Finansavisen.

Nordic Aquafarms currently has land-based production of salmon in Fredrikstad and yellowtail kingfish in Denmark, but has big ambitions for growth in the US market. The long-term ambitions are 50,000 tonnes in annual production capacity at two equally large facilities in Maine and California.

Rottingsnes estimates a construction cost between 600 and 650 million dollars for each of the US facilities. The company has an ambition that 50 percent of the completed project will be financed through bank loans.

“But we think that most of it probably comes towards the end of the project period, ie when you are up and running and have produced fish. In the beginning, it will mostly be equity”, he says.

He has the impression the banks consider financing land-based farming to be risky.

“Yes, I think it is fair to say the banks still think it is too early to lend to land-based fish farming. The banks have financed Atlantic Sapphire, and I believe the banks think they need to see some results from there before they lend”, Rottingsnes tells Finansavisen.

Nordic Aquafarms, which currently produces salmon at the facility in Fredrikstad, has chosen to phase out the investment in salmon to switch to yellowtail. Rottingsnes believes it is easier to achieve profitable production of yellowtail kingfish versus salmon, since higher margins are achieved. The company currently sells yellowtail for NOK 160 per kilo (EUR 15.4).