Why Grieg Seafood opted not to bid in first auction round

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Yesterday it became clear that 13 companies had bid successfully to buy more volume for EUR 244.5 million. Grieg Seafood and Lerøy Seafood were not among the buyers.

“I wouldn’t rule out that you see more activity from Grieg Seafood next time growth (in the form of license auctions) is advertised,” Managing Director Andreas Kvame, told Salmon Business.

Most of the big companies participated in the auction that kicked off on Monday. SalMar, Cermaq and Marine Harvest were among the most eager while small-scale producer Lovundlaks bought more volume for EUR 49.6 million.

3,840 tonnes license capacity still remained after two days, which was put up for sale yesterday.

Focus on what they already have
Grieg Seafood, on the other hand, told Salmon Business they already have a surplus of capacity in relation to production output. Kvame declined to comment on the extent to which Grieg may or may not have participated in the auction.

“We’re unable to exploit our potential the next two years. So we’re focusing on what we already have for the time being,” said Kvame.

Salmon Business asked “Producers bought growth for EUR 244.5 million. That indicates there is quite a lot of optimism for the future. What are your thoughts on that?”

“What it tells me is that we have a colossal, unexploited resource value,” said Kvame and referred to the company’s own capacity.

Read also: Small scale producer forks out HUGE amount at salmon license auction

Exploiting just one-quarter of production capacity
This year, Grieg Seafood expects to produce around 30,000 tonnes in Norway, while the company’s total capacity is between 38-40,000 tonnes. This means up around 25 percent of capacity is untapped.

“Among the challenges we face is the fact that we have too few sites. That’s a constant problem. We need new, top-notch sites. But we’re working on that,” said Kvame.