Canada: Newfoundland salmon sector could see fivefold growth by 2030
If the Canadian province of Newfoundland & Labrador really threw its back into it, it could be producing more than five times its current volume of Atlantic salmon and exceed 100,000 metric tons annually by 2030, topping even British Columbia, says a report released this week.
McKinsey & Company, a New York-based management consulting firm with Canadian offices, was hired by the provincial government in September for CAD 1 million ($747,303) to suggest ways to boost the economy. Earlier this week it returned with a 156-page report that shares 12 ideas that it says could help add 30,000 new jobs by 2030, increasing the province's gross domestic product (GDP) by CAD 5 billion to CAD 12bn.
Such economic sparks would be more than welcome in a province where the unemployment rate is reported to be at an average 14.8% vs. the national average of 5.6%.
Among the consulting firm's suggestions: increase tourism by, building upgraded camping/”glamping” facilities on Newfoundland’s west coast and adding bus routes to attractive destinations; increase agricultural sales by marketing berries, honey and “saltwater lamb”; and accelerate the development of an offshore oil operation center.
But of most interest to Canada's aquaculture industry are the report’s suggestions for salmon production.
According to provincial data, NL was responsible for 17,978t of aquaculture production in 2018, 15.107t of which was related to the province’s 88 commercial salmon sites, which cover a combined area of 2,500 hectares (6,177 acres). But that was a 20% decrease blamed in part on weather events and an outbreak of infectious salmon anemia (ISA) in 2017.
At present, NL is nowhere the king of Canadian salmon aquaculture. That would British Columbia, which is responsible for about 80,000t of annual production worth close to CAD 500bn.
Still, there is the potential of a new ruler, according to the McKinsey report.
“Fully realized, increased salmon production, coupled with a substantially more integrated aquaculture supply and services network, could contribute up to CAD 600m in GDP uplift and generate more than 7,000 additional jobs by 2030,” it advises.
CETA a big advantage in Europe
The McKinsey report’s predictions for salmon growth build off a plan announced in September 2017 by Dwight Ball, the provincial government's premier, called “The Way Forward for Aquaculture”. It launched 28 actions intended to grow salmon production to 50,000t annually and mussel production to 10,750t annually.
The McKinsey report says the province could do even better, partly as a result of the high expected demand growth for salmon (6% annually through 2022) combined with persistent global supply constraints. The demand growth in the US is expected to be even higher at 8% annually, the report notes.
NL has a big advantage thanks to the Comprehensive Economic and Trade Agreement (CETA) between Canada and Europe, the world’s largest importer of fish and seafood. As a result of CETA, 96% of the EU tariff lines for fish and seafood are duty-free and, after seven years, they will be 100% duty-free.
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