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NORWEGIAN SEAFOOD INDUSTRY DID WELL IN FIRST STAGE OF PANDEMIC

NORWEGIAN SEAFOOD INDUSTRY DID WELL

Norwegian seafood industry did well in first stage of pandemic. The Norwegian seafood industry and the specialised supplier industry did well through the first phase of the pandemic. Total value creation in the seafood industry amounted to NOK 59 billion in 2020. This is a decrease from 2019, but the industry also increased by 2000 employees. If ripple effects are included, the seafood industry provides the basis for 93,600 jobs.

This is stated in a report prepared by Menon Economics, Nofima and Norce. The pandemic and the lockdown of society around the world led to major changes in the demand for seafood, with a sharp reduction in demand in the restaurant segment and in the price of salmon. Nevertheless, the seafood industry managed to reach consumers in the grocery market and thus maintain volumes, albeit at a somewhat lower price. As a result, seafood exports, measured in volume, increased in 2020 while export value fell.

Despite a decline, value creation in the seafood industry still remains at a historically very high level. Value creation in the industry laid the foundation for total tax effects of approximately NOK 30 billion in 2020.

“Through the purchase of goods and services, the seafood industry provides the basis for employment and value creation in large parts of Norwegian trade and industry. Our analyses show that the total value creation effect in the industry amounted to NOK 112 billion”, says scientist Roy Robertsen, who is the project manager for the report.

The seafood industry not only creates value in the form of employment, value creation and taxes in its own companies. Through the purchase of goods and services, it also provides a basis for value creation, employment and tax payments from suppliers and society in general. The ripple effects are calculated in Menon’s ripple effect model and show that the seafood industry provides the basis for around 93,600 jobs. This amounts to 83,000 man-years, which corresponds to around five percent of total Norwegian employment in the private sector.

“One of the most striking features of the Norwegian seafood industry is the almost complete value chain. With major actors in everything from fisheries and aquaculture to suppliers of vessels and the fishing industry, this is one of the industry’s most important competitive advantages. An integrated value chain results in major ripple effects for the whole country”, says Jonas Erraia, Senior Economist at Menon Economics.

The seafood industry is one of Norway’s most important regional industries. The industry is represented throughout the entire country, but it is in Western and Northern Norway that seafood production is most important regarding value creation and employment. There are 15,800 people who are directly or indirectly employed in the seafood industry in Vestland county, followed by Møre and Romsdal with 14,100 and Troms and Finnmark with 10,700.

Discussions have been going on a long time regarding which municipality is the most important seafood municipality. There are several ways to calculate this. Measured in value creation, which basically can be described as the sum of wages and profits in companies, or as the companies’ contribution to Norwegian gross domestic product, Ålesund is the largest, closely followed by Frøya.

The fact that Bergen and Ålesund are at the top when it comes to turnover and value creation is a result of them being relatively large cities, with head office functions for many seafood companies and a lot of supplier industry.

“In recent years, we have seen the development of a specialised supplier industry, in the same way that we developed an oil supplier industry. The core area of this industry stretches from Rogaland to Northern Norway, but there are key companies in all counties”, says senior scientist Atle Blomgren at NORCE.

Blomgren highlights the fish hook specialist Mustad at Gjøvik and the Oslo company called Stingray. These companies are developing laser solutions to deal with salmon lice problems, and are examples of specialised suppliers.

“The supplier industry is now developing as an important export industry”, he says.

 

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