Thursday, February 18, 2010

Will collapsing Chilean salmon prices provide opportunity for British Columbia?

The Chilean salmon industry is in a state of collapse these days, that after disease rippled through that nations farmed salmon industry resulting in a serious decline in Chile’s output. Chile is the world’s second largest provider of salmon, it has been been hammered by the virus that causes infectious salmon anaemia, which emerged in 2007, since that time that nation's output has declined by 75 percent.

A forecast for sales of Chilean salmon is to be around 90,000 tonnes a massive decline from two years ago when annual sales were in the 400,000 range.

So far the main beneficiary of Chile's troubles has been Norway, which is expected to provide about 70 per cent of the market for farmed salmon in 2010. Norway's main corporate aquaculture company Marine Harvest (which is involved in British Columbia as well) saw it's corporate share value increase by 400 per cent since 2009.

Outside of Norway's massive dedication to the aquaculture industry there are few countries to pick up the slack, Canada and the United Kingdom make up 20 percent of the world market in production, with Chile's troubles continuing it's anticipated that they will also see their output increase.

Fish farming in Canada has always been a controversial aspect of the marine environment, and for the most part the reason given for the Chilean crisis has been the most often quoted concern for British Columbians. Environmental observers of Chile's system suggest that their problems stem from overcrowding in its salmon cages and by the use of too many chemicals.

Industry analysts said salmon would have to be farmed at a much lower density in Chile in the future.

At the moment, fish farming in British Columbia is limited to the Central coast and southern waters, though as recently as this week, the prospects of a northern expansion of the industry seem to be in motion, with Lax Kw'alaams said to be exploring the closed containment option.

While the farmed market suffers its troubles of late, still to be seen is what kind of fishing season may be ahead for the Wild commercial sector in British Columbia. Considering the very public problems that seem to be affecting the farmed option, it would appear that the Wild industry could make some inroads into territory that it once controlled without much competition from the farming industry.

Of course, any rebound of fortunes for the Commercial Wild sector will depend on one very important aspect, that of the state of the fish stocks heading towards the British Columbia coastline. How things develop as we head into Salmon season this summer could set the future course of the wild industry, which while facing numerous challenges could find a renaissance in the face of the farming industry woes of late.

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