COMMENCEMENT OF SALMON EGG PRODUCTION IN SALTEN, NORWAY
Benchmark has begun the commencement of salmon egg production at its new land based breeding facility in Salten, Norway, which will increase the company’s capacity by 75%.
The Salten facility has been built to the highest standards of technology and biosecurity and will be the most modern salmon egg production site in the world. The increased capacity will allow Benchmark to supply the global market with biosecure eggs year-round, a significant advantage for producers only possible with land based production.
The announcement is the culmination of a two year, £40m investment, delivered on time. The new facility will increase Benchmark’s in-house capacity by 75% allowing the company to capitalise on its leading market position. Benchmark – a world leader in both salmon genetics and as a supplier of salmon eggs – currently outsources part of its production to meet growing demand for its products. The new facility will enable Benchmark to bring production in-house enhancing profitability.
Sales of fertilised eggs will commence in November 2018 and additional fish will be brought into the facility to ramp up volumes throughout 2019. As anticipated, initial sales will benefit the 2019 financial year, with full production capacity expected by 2021. Salten is located in Northern Norway where the salmon production base is growing fast. The new facility will allow Benchmark to serve this growing region as well as the rest of Norway and international markets.
The fundamentals for salmon farming continue to be very attractive. Global demand for salmon has grown by 6-7% p.a. in recent years and is expected to increase substantially over the next decade from countries including America and China where consumption per capita is low, but growing as a result of increasing health awareness and a growing middle class. This growth and a continuous effort to increase efficiency in the industry will continue to drive demand for robust genetics.
The Group expects to issue a trading update for the year ending 30 September 2018 towards the end of October 2018.