Mowi plans huge growth – along with major cost cuts

Presenting its Capital Markets Day in Trondelag, the world’s largest producer of Atlantic salmon has spelled out a strategy to cement its leading position in the industry in the coming years.

The Mowi group’s plan is to grow production volume by 100,000 tonnes as well as making cost “improvements” of €300m-€400m (£250m-£333m).

Mowi is also considering moving to other methods of salmon farming in addition to coastal operations.

CEO Ivan Vindheim (pictured, at the presentation) said: “After reaching a milestone 500,000 tonnes of salmon harvested in 2024, we are now looking ahead to the next milestone of 600,000 tonnes which we aim to fulfil in 2029.

“We will achieve this through better utilisation of licence capacity, while also improving productivity and biological performance of existing production through our investment in post-smolt.”

Furthermore, he added, Mowi is planning an ambitious cost improvement programme, building on a drivelaunched in 2018, which has led to €300m in savings through 1,700 different initiatives.

He said Mowi’s strategy is built on three pillars – volume growth, competitive costs and sustainability. The company has grown from producing 375,000 tonnes of salmon in 2018 to an expected 500,000 tonnes in 2024. Now Mowi plans to continue that trend.

“We have grown faster than the rest of the industry in recent years, and our goal is to continue to do so in the future. By releasing more smolt and increasing our use of post-smolt we will be able to harvest 600,000 tonnes of salmon in 2029, thereby reinforcing our position as the world’s top producer of Atlantic salmon,” Vindheim added.

In addition to the company’s post-smolt venture and the improvements in biological performance that it brings, Mowi’s digitalisation and automation strategy is also central to the company’s plans.

“We launched Mowi 4.0 in 2021 and since then have invested heavily in a range of measures to introduce greater efficiency and automation across our value chain. We are already seeing the positive impact this has had on sustainability, productivity and cost reduction, and we expect to reap further benefits in the years to come,” Vindheim said.

Continued growth in Mowi’s farming operations will in turn lead to growth in its two other divisions, namely Consumer Products and Feed.

“The rest of the supply chain will grow in line with farming going forward. To produce more salmon we need more feed, and more salmon means more raw material for our 20 secondary processing plants around the world,” Vindheim said

The company estimates revenue growth of 7-8% per year over the next five years, resulting in revenue of €8.5bn (£7.1) in 2029, compared with €5.5bn (£4.6bn) in 2023.

Mowi’s focus has been and will continue to be sea-based salmon farming and related technology, Vindheim stressed. He said, however, that the company is nonetheless closely observing developments in other technologies and is prepared to adopt new technologies as and when the time is right and they show themselves to be profitable.

The company said it is also looking to grow through selective acquisitions, provided they fit into the company’s operational strategy.

Story updated 27 September 2024.