Set for growth
The salmon sector is set for long-term expansion, if it can get over the obstacles in its way, says a leading analyst firm. Vince McDonagh reports.
The global salmon industry is set to bounce back following several years of marginal decline, says Kontali Research, the leading seafood analysis business.
It estimates that, by 2033, production will have surged by around 40%, surpassing four million tonnes.
Kontali maintains recovery will be driven by enhancements in fish health, strategic investments and a substantial rise in land-based production. But it also cautions that without these key factors, the industry’s growth may not fully materialise.
Kontali is a leading provider of independent analysis and insights for the global seafood sector, with a focus on salmon production and market trends.
It predicts that Europe (including Scotland) is expected to lead this growth, with production increasing by approximately 25%, while the Americas will experience more modest gains at around 11%.
Contributions from Australia and New Zealand will be smaller, at about 17%, and Asia, particularly China, is poised for gradual expansion, with land-based and offshore projects driving growth, though large-scale production is yet to be fully realised.
Kontali says its long-term analysis indicates that the industry’s turnaround will depend on continued innovation to address regulatory constraints and health challenges, which appear to be mounting up at the moment.
Turning to the various risks facing the industry, it says that regulatory limits, such as maximum allowable biomass (MAB) and environmental regulations, pose the primary challenges to growth.
In Norway, for example, sea lice and fish health concerns are closely linked to these constraints.
But industry players are investing in solutions such as new sheltered cage technology and biosecurity measures to mitigate these risks.
As has been well reported, climate change is bringing new weather patterns, temperature shifts and pathogens to Norway’s coastal regions, posing additional hurdles for salmon farming operations worldwide.
Industry players must continue to invest in adapting to these challenges to ensure the industry’s long-term success.
Filip Szczesny, the Senior Financial Analyst at Kontali, says: “The projected 27% growth in global salmon production by 2030 marks a pivotal moment for the industry. Investments in fish health and land-based production are key drivers, but overcoming regulatory and environmental challenges will be crucial to realising this potential.”
Kontali breaks down its analysis to the various regional production zones as follows:
Norway: Recovery is expected after recent productivity challenges. Growth will be driven by improved production planning, enhanced fish health measures and investments in submerged cage technologies.
However, regulatory restrictions under Norway’s traffic-light system and tax regime could limit growth potential.
Europe (excluding Norway): The UK (essentially Scotland), the Faroe Islands, and Iceland are set to benefit from investments in large smolt and shorter production cycles. Iceland, in particular, faces new regulations aimed at protecting wild stocks and improving biosecurity.
Chile: Political uncertainty remains a key risk, though recent developments have lessened the likelihood of major disruptions to aquaculture operations in the key regions. Biosecurity risks continue to grow as the sector nears maximum productive capacity.
North America: In Canada, a transition towards land-based systems is underway following regulatory changes on Canada’s Pacific coast. In the USA, ocean-farmed production is expected to remain stable, while land-based and offshore projects will provide growth opportunities.
Australia and New Zealand: Warmer sea temperatures have slowed growth in Australia, but a recovery is expected. In New Zealand, new coastal projects will replace existing production, contributing marginally to global growth.
Russia and Asia: In Russia, growing domestic demand for salmon is encouraging the development of new farming sites and infrastructure, though actual production may fall short of ambitious targets. In Asia, particularly China, land-based and offshore projects are planned, but large-scale production has yet to be realised.
Kontali says land-based production will be the single largest growth segment and is fast gaining traction as a politically and environmentally sustainable alternative to traditional farming methods.
Growth in this segment is expected to be the single largest contributor by 2033. Norway is developing flow-through technology, while North America and Asia are becoming increasingly attractive regions for new investments due to proximity to major markets. Significant investments are also being made in Iceland to support stricter biosecurity regulations.
Meanwhile, wild salmonid catches are projected to remain stable, averaging between 800,000 and 900,000 tonnes per year, with seasonal fluctuations.
In an earlier report, Kontali Lead Salmonids Analyst Lars Daniel Garshol said that next year, closer to 60% of global volume is expected to be harvested and sold in the second half of 2025, with retail as the primary end-sales channel to consumers.
For producers, value growth in 2025 is anticipated to be driven by increased volumes, particularly through retail promotions and campaigns for farmed salmon, rather than higher spot prices.
He also believes increased production and improved conditions will drive volume growth, and prices are likely to decline as a result. This sets the scene for a more competitive and potentially volatile market.
Market participants will need to consider how best to navigate this new volatility in the market, he maintains.
Producers are also expected to hedge by increasing the share of contracts with retail buyers, but spot availability in Europe may still be attractive, especially considering anticipated significant price differences between the first and second halves of 2025.
However, an improved macroeconomic environment, with declining inflation and rising consumer purchasing power, could help balance downward pressure on prices by boosting demand in key markets, Kontali says.
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