Lumpfish: an increasingly lucrative business

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There are “insane” profit margins to be made for lumpfish producers.

The little, blue wrasse fish has become the third largest farmed fish species in Norway after it proved itself as an efficient and eco-friendly weapon against salmon lice.

Sales, EBIT and EBIT/Sales – all figures in NOK

Increasing demand
There is already considerable demand from the market, and supply is gradually building to meet this demand.

SalmonBusiness has studied the 2017 results for 12 different lumpfish producers. None have a red bottom line, and only three companies have a profit margin below 20 percent.

“Demand is increasing for us. Our repeat customers are increasing their consumption year after year, and we’re getting fantastic feedback on the quality that is the reason why we are the preferred supplier to amongst others the research sector,” Nils Bjarte Sætrevik, managing director of Vest Aqua Base told SalmonBusiness.

Repeat customers
In 2017, Vest Aqua Base produced around 1.6 million fish, and estimates production will increase by 15 percent in 2018, and end the year at 1.8 million fish.

They have a production license for 115 tonnes biomass, which equates to 4.6 million fish with an average weight of 25 gram.

Learning everyday, Nils Bjarte Vest Aqua Base PHOTO Ole Alexander Saue

“We have repeat customers, with purchasing agreements, but now and then we supply on spot. The bulk of sales goes to the regulars that we have agreements with,” said Sætrevik. He declined to give further details concerning contract prices on lumpfish sales.

“We are constantly assessing developments,” he said.

Vest Aqua Base is owned by Austevoll Melaks, Eide Fjordbruk, Langøylaks, Tombre Fiskeanlegg, Engesund Fiskeoppdrett, Troland Lakseoppdrett and Telavåg Fiskeoppdrett.

From EUR 2.3 per fish
Lumpfish production has been established in numerous locations in recent years, and SalmonBusiness understands there could soon be as many as 40 lumpfish producers servicing the market.

Namdal Rensefisk, owned by Bjørøya, Marine Harvest, Emilsen Fisk, Midt-Norsk Havbruik, Aqua Gen and Nova Sea, is amongst these.

“Most of the fish we produce go to our owners,” Namdal Rensefisk Managing Director, Per Anton Løfsnæs, told SalmonBusiness.

“But spot prices are at 21-22 kroner per fish per individual, vaccinated 50 gram. Right now demand is rising, so the market’s improving,” he said.

Namdal Settefisk estimates production volume for 2018 will be around two million fish in 2018.