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Industry handbook The White Fish Industry 2015 The purpose of HAVFISK Industry Handbook is to give investors, financial analysts and other interested parties better insight into the white fish industry.

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Page 1: The purpose of HAVFISK Industry Handbook is to give ... Saithe are also among the main white fish species in the Northern Atlantic fished by Norway, Iceland, Russia and the EU. In

Industry handbook The White Fish Industry 2015

The purpose of HAVFISK Industry Handbook is to give investors, financial analysts and other interested parties better insight into the white fish industry.

Page 2: The purpose of HAVFISK Industry Handbook is to give ... Saithe are also among the main white fish species in the Northern Atlantic fished by Norway, Iceland, Russia and the EU. In

Innhold 1 The white fish segment ................................................................................... 3

1.1 Whitefish – White fish? ................................................................................................................. 3

1.2 A definition or clarification of the segment .................................................................................. 3

1.3 White fish – Role in the seafood world? ....................................................................................... 4

1.4 The most important white fish species from the fisheries............................................................ 7

1.5 2014 – The most important white fish species from aquaculture .............................................. 12

2 The world market for white fish – substitution etc. ...................................... 13

2.1 Consumption of white fish from fisheries – by main markets .................................................... 13

2.2 Consumption of white fish from aquaculture – By main markets .............................................. 15

2.3 How are the white fish species sold and marketed? ................................................................... 17

2.4 Price comparison main commercial white fish species ............................................................... 21

3 Availability & Management of whitefish/groundfish resources ..................... 22

3.1 Total allowable catch (TAC) ......................................................................................................... 22

3.2 Resource Management ............................................................................................................... 23

3.3 Fisheries in the northeastern Atlantic Ocean .............................................................................. 25

3. 4 Seasonal variations for different species ................................................................................... 26

4 Fishing gear ................................................................................................... 27

4.1 Conventional and ocean-going fleets .......................................................................................... 27

4.2 Fishing gear .................................................................................................................................. 27

Gillnet ............................................................................................................................................ 27

Hook-and-line gear ........................................................................................................................ 28

Jigging ............................................................................................................................................ 29

Trawling ......................................................................................................................................... 30

Seines ............................................................................................................................................. 31

5 Sustainable fisheries and health issues .......................................................... 33

5.1 Sustainable catch of a natural resource ...................................................................................... 33

5.2 Fishing gear – impact on the environment ................................................................................. 33

5.3 Protecting coral reefs .................................................................................................................. 34

5.4 Programmes and certifications ................................................................................................... 34

CRISP and MAREANO .................................................................................................................... 34

Marine Stewardship Council (MSC) ............................................................................................... 35

KRAV .............................................................................................................................................. 35

1

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Friend of the Sea (FOS) .................................................................................................................. 35

5.5 Megatrends – Health, convenience, environment and ethics .................................................... 36

5.6 Nutritional benefit from eating fish ............................................................................................ 36

5.7 Environmental influence ............................................................................................................. 37

6 Industry structure for important fishing nations ........................................... 38

6.1 Industry Structure........................................................................................................................ 38

7 Norwegian fisheries – quotas, structure, regulation, and prices .................... 41

7.1 Distribution in Norway – conventional coastal and ocean-going fleet ....................................... 41

7.2 Regulations – The Fishing Participation Act ................................................................................ 43

7.3 First-hand sales ............................................................................................................................ 43

The Raw Fish Act............................................................................................................................ 43

Sales organisations ........................................................................................................................ 44

7.4 Price settlements ......................................................................................................................... 45

Fresh .............................................................................................................................................. 45

Frozen ............................................................................................................................................ 45

7.5 Fishing areas (Norwegian coast, Barents Sea, etc.) .................................................................... 45

8 HAVFISK ......................................................................................................... 49

8.1 Norwegian quota system – HAVFISK’ quotas .............................................................................. 49

Obligations ..................................................................................................................................... 49

Higher quota ceiling for cod trawling ............................................................................................ 50

8.2Vessel segments ........................................................................................................................... 50

New trawlers ................................................................................................................................. 51

8.3 Operating pattern ........................................................................................................................ 51

8.4 Products and sales ....................................................................................................................... 53

8.5 Crew and expertise ...................................................................................................................... 54

8.6 Safety ........................................................................................................................................... 54

8.7 Efficiency and costs in harvesting ................................................................................................ 55

9 Outlook ......................................................................................................... 57

The Tveterås committee ............................................................................................................... 57

Sources............................................................................................................. 58

APPENDIX ......................................................................................................... 59

2

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1 The white fish segment

1.1 Whitefish – White fish? The term “whitefish” or “white fish” is a market-oriented term, referring to fish marketed for human consumption, with white flesh, and which is not “oily”. In white fish the fat reserves are typically in the liver, and not in the flesh and guts.

1.2 A definition or clarification of the segment In the last couple of decades, increasing availability of freshwater species from aquaculture, with the same characteristics - white flesh and fillets with little oil content - has entered and captured a large share of the “white fish” market segment. Pinning this down to what species of major international and commercial interest the market term “white fish” includes, the figure below describes this in terms of a “core” segment, including species both from fisheries and aquaculture, with numerous other species being more or less close to this core segment.

Fisheries Aquaculture

- Tilapia

- Pangasius

- Meagre

- Catfish

- Cobia

- Cod

- Saithe

- Hoki

- Haddock

- Hake

- Pollock

- European Seabass

- Gilthead Seabream

- Halibut

- Turbot - Orange Roughy

- Patagonian Toothfish

- Southern Blue Whiting

- Redfish- Soles- Plaice

- Ling

- Tusk- Olive Flounder

- Barramundi- Wolf-fish- Monkfish

- Northern Blue Whiting - Milkfish

- Carp“Core“

White Fish

Market

“Peripheral“ Species

White Fish Segment

Source: Kontali Analyse AS

- Greenland Halibut

3

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1.3 White fish – Role in the seafood world?

The global supply of seafood resources has increased in the last couple of decades from approximately 140 million tonnes to around 163 million tonnes in 2013, according to the FAO (excluding plants, algae and marine mammals). Of this, slightly more than 20 million tonnes of the pelagic resources are species that are not destined directly for human consumption, but go to the reduction industry where they are converted to fishmeal and fish oil. This leaves around 140-145 million tonnes of seafood for human consumption. There is a general understanding that the degree of uncertainty in the statistics is higher in reported figures from regions where the fishing is done by small coastal fleet operators, and where the fisheries are not regulated by quotas or other restrictions. This often corresponds to areas where there is also very limited registration of data or volumes at landing auctions or market auctions. A number of freshwater carp species dominate the volume arising from aquaculture, but this is normally produced, marketed and sold very locally, much of it in China and other Asian countries. Besides this, the categories where we typically find the species competing in the white fish segment constitute around 50 million tonnes globally, include several hundred different species, and are outlined in blue in the figure above. The 15-20 most commercially traded of these species represent some 14-18 million tonnes, and will be the basis for the further analysis in this guide.

163 mill tonnes

Fisheries - 92,6 mill tonnes Aquaculture - 70,2 mill tonnes

Pelagic marine fish 35 Carp 26,8Groundfish 20,1 Tilapia 4,8Other marine fish 11 Catfishes 2,7Freshwater fish 11,2 Oth.Fresw.Fish 9,5Molluscs/squid 6,9 Molluscs 15,5Crust/Shrimps 6,5 Crusta./Shrimp 6,4Salmonids 1,1 Salmonids 3,2Other 0,8 Demersal marine 1,3

Total Seafood Resources - 2013

4

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Since the beginning of the 1990s world fisheries have ranged between 85 and 95 million tonnes. It is not expected that world fisheries will increase as the stocks are considered to be fully utilised. The annual growth in the aquaculture sector has been between 5-7% annually in the period from 2000 to 2013, and reached 70 million tonnes in volume in 2013. According to the FAO it is the fastest growing food producing sector worldwide. World aquaculture is heavily dominated by Asia-Pacific production. The dominance is mainly because of China’s enormous production which in 2013 accounted for 60% of global production according to FAO. There is expected to be continued growth in the aquaculture production. The question is how strong this growth will be the coming years. The world population is growing and demand for food fish will increase. If the world population is to maintain a per capita consumption on today’s level in the future, the increase will have to come from the aquaculture industry. Global annual per capita fish consumption is expected to increase from about 19 kg in 2011 to 22-23 kg by 2030 (FAO). If we assume a growth in the aquaculture production of 4.5% the next 20 years, total catch and aquaculture production will reach 276 million tonnes in 2035. Most experts on aquaculture business predict that the production growth will slow down and become weaker in the coming years.

Catch 7,2 mill mt Aquaculture 10,8 mill mtAlaska Pollock 48,8 % Tilapia 50,3 %Hake 14,5 % Pangasius/Catfish 42,1 %Atlantic cod 16,8 % Seabass/Seabream 5,3 %Pacific cod 6,8 % Olive Flounder 0,4 %Haddock 3,8 % Cobia 0,4 %Saithe 3,9 % Barramundi 0,7 %Hoki 3,3 % Turbot 0,7 %Southern Blue Whiting 0,9 %Source: FAO, Kontali Analyse

Main Commercial white fish Species - 2015 E

0

50

100

150

200

250

300

1950

1953

1956

1959

1962

1965

1968

1971

1974

1977

1980

1983

1986

1989

1992

1995

1998

2001

2004

2007

2010

2013

2016

2019

2022

2025

2028

2031

2034

Mill tonnesDevelopment and estimates - world catch and aquaculture prodiction 1950 - 2035

source: FAO

Aquaculture Catch

Estimates 2014-2035

5

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If we assume an average growth in aquaculture production of 2% a year, total catch and aquaculture production will still reach 185 million tonnes in 2035.

Looking particularly at the white fish species during the last three years of the last decade, there has been a shift from a situation where strong growth in white fish species from aquaculture balanced out a decline in catches of groundfish species, to the current trend with growth in farmed whitefish. The availability of groundfish has also been increasing. The total supply of these selected white fish species has been increasing over the last decade, also including the current estimate for the 2013 and 2014 supply.

0

2.000.000

4.000.000

6.000.000

8.000.000

10.000.000

12.000.000

14.000.000

16.000.000

18.000.000

20.000.000

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014Est

2015Est

1000

tonn

es ro

und

wei

ght

Catch from fisheries and aquaculture production 2001-2015 Est

White fish from Aquaculture White fish from Fisheries

Annual growth 01-10:14 %

Annual growth 10-15E:7 %

Annual growth 10-15E:2,2 %

Annual growth 01-10:0,7 %

Source: Kontali Analyse

6

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1.4 The most important white fish species from the fisheries

The seven most important white fish species from fisheries accounted for more than 7 million tonnes in 2014. Alaska Pollock, which is one of the world’s largest fisheries in terms of volume, accounted for 47% of the volumes. Atlantic cod and hake followed as numbers two and three. Alaska Pollock is a native species in the Bering Sea with the US and Russia being the two largest fishery nations representing nearly 90% of the total catches. Atlantic Cod is the main commercial white fish species in the North Atlantic with Norway, Russia, Iceland and the EU as the main players. Haddock and Saithe are also among the main white fish species in the Northern Atlantic fished by Norway, Iceland, Russia and the EU.

In 2014, total supply of the main white fish species from fisheries remained at 2013 levels.

3.543

1.050

1.216

345

280494

260

White fish catch - 2015 E

Alaska Pollock

Hakes

Atlantic Cod

Haddock

Saithe

Pacific Cod

HokiSource: Kontali AnalyseSource: Kontali Analyse

Alaska Pollock

Atlantic cod Hake Saithe Haddock SBW

Pacific cod Hoki TOTAL

Chile - - 40 000 - - 14 000 - 40 000 94 000 88 000

Argentine - - 270 000 - - 9 000 - 45 000 324 000 328 000

USA 1 405 000 - 250 000 8 000 3 000 - 330 000 - 1 996 000 1 984 000

Canada 10 000 18 000 50 000 5 000 8 000 - 5 000 - 96 000 88 000

Russia 1 670 000 448 000 2 000 1 000 77 000 - 80 000 - 2 278 000 2 212 000

Norway - 475 000 2 000 156 000 94 000 - - - 727 000 659 000

Iceland - 239 000 - 53 000 36 000 - - - 328 000 329 000

Faroe Islands - 17 000 - 17 000 3 000 - - - 37 000 51 000

EU - 160 000 68 000 54 000 50 000 - - - 332 000 318 000

Namibia - - 140 000 - - - - - 140 000 140 000

South Africa - - 150 000 - - - - - 150 000 145 000

Japan/S-Korea 280 000 - - - - 3 000 65 000 - 348 000 343 000

New Zealand - - - - - 35 000 - 150 000 185 000 195 000

Others - 10 000 96 000 14 000 1 000 2 000 2 000 4 000 129 000 118 000

Total 3 365 000 1 367 000 1 068 000 308 000 272 000 63 000 482 000 239 000 7 164 000 6 998 000

Source; National statistics/KA-Est.

NationCatch by nation and species 2014

E 2015

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Photo: Stian Skjong

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The largest fishing nations in the EU in the case of cod, haddock, saithe and hake are the UK and France. Total catches have varied between 80,000 and 90,000 tonnes over the last four years, of which cod and haddock constitute the largest share. France, Spain, Denmark and Germany are other important white fish nations. In Denmark and Germany, cod constitutes the largest share of the catches. In France and Spain it is the hake catches which make up the largest share of the volumes.

Estimated first hand values for the different white fish species are calculated on basis of an average estimated first hand price. The two most important commercial species in terms of value are the Alaska pollock and the Atlantic cod. The Alaska pollock fishery is estimated at over NOK 16 billion followed by the Atlantic cod which is 2 million tonnes smaller in volume than the Alaska pollock. The haddock and saithe species in the North Atlantic are normally lower priced than the Atlantic cod and

0

10

20

30

40

50

60

70

80

90

100

France UK Spain Denmark Germany Poland Sweden Portugal Others

1000 tonnesAnnual catch main catching nations EU - selected species

(cod, haddock, saithe, hake)

2012

2013

2014 E

2015 E

2016 E

Source: Fkd

02.000.0004.000.0006.000.0008.000.000

10.000.00012.000.00014.000.00016.000.00018.000.000

AlaskaPollock

Atlanticcod

Hake Haddock Saithe Pacificcod

Hoki SBW

1000 NOKMain whitefish fisheries by first hand value - 2014 E

Source: Kontali Analyse

9

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also less important in terms of volume. Haddock and saithe prices have increased strongly in recent years and haddock prices in Norway have been higher than cod at times. Estimated total haddock value exceeded NOK 3.7 billion in 2014 while estimated saithe value was approx. NOK 2.5 billion. Total first hand value of pacific cod was approx. NOK 3.3 billion in 2014 while the hoki catches were estimated to be above NOK 1.4 billion in first hand value.

There are a number of other species defined in the white fish segment which are of vital commercial interest in certain areas, mainly in the North Atlantic. Some of the catches of these species are taken directly while some of the volumes are caught as by-catch. Main catching nations are mainly the same as for other groundfish in these areas, namely Norway, Russia, the EU, Iceland and the US.

Redfish is the largest of these selected species in terms of volume and value. Approximately 120,000 tonnes were caught in 2014 and estimated first hand value was over NOK 1.4 billion. The first hand value of Greenland halibut was slightly below the value of the redfish catches in 2014. The third largest fishery in terms of value is the monkfish which is highly valued species.

There are variations in the seasonal catch pattern between the different species. One third of the total whitefish catch is landed during the three first months of the year. Alaska pollock, Atlantic cod,

0

200

400

600

800

1.000

1.200

1.400

1.600

0

20.000

40.000

60.000

80.000

100.000

120.000

140.000

1000 NOKmtOther Species, North Atlantic 2014E

Catch 2014 - Value 2014

Source: Kontali Analyse

0,0 %

5,0 %

10,0 %

15,0 %

20,0 %

25,0 %

janmar

maijul

sep

nov

Monthly share of total catch (2012-2014)

Pollock

Hake

At. Cod

Haddock

Saithe

Pacific cod

Hoki

Source: Kontali Analyse

10

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saithe, and Pacific cod have their main season at the beginning of the year, while haddock and hake are more evenly distributed throughout the year. The main hoki season is May-July, with a slight increase also in December.

Photo: Harald Petersen

Photo: Peder Otto Dybvik

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1.5 2014 – The most important white fish species from aquaculture

Aquaculture remains a growing production sector, although it has slowed down compared to what we have seen the last three decades. The growth from 2000 to 2013 remained stable between 5 and 8% per year. Production from aquaculture is mostly destined for human consumption.

The most important species defined in the white fish segment are the tilapia and pangasius/catfish species. Tilapia is the largest and production in 2014 is estimated to exceed 5.4 million tonnes. Tilapias are mainly produced in Asia and in some African countries. China, Egypt and Indonesia are the largest producers. China accounted for approx. 2.9 million tonnes in 2013.

Pangasius, or pangas catfish as it is also called, is well known from the aquaculture industry in Vietnam, but there are also a number of other species in this category which has seen a large growth in production in the last 5 – 10 years. According to the FAO, pangas production in Vietnam was approx. 100,000 tonnes in 2000. In 2013 the production was calculated at more than 1.8 million tonnes.

Sea bass/sea bream production is takes place mainly in the Mediterranean area and the main producers are Turkey, Greece, Spain and Egypt.

5.4404.560

570

50

5077

Aquaculture production - 2015 E

Tilapia

Pangasius/Catfish

Seabass / Seabream

Cobia

Barramundi

Turbot

Source: Kontali AnalyseSource: Kontali Analyse

12

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2 The world market for white fish – substitution etc.

2.1 Consumption of white fish from fisheries – by main markets The EU is by far the most important market for the wild-caught white fish species. Approximately 47% of the estimated total white fish supply ends up in the EU market. This constituted 3.2 million tonnes round weight of fish in 2014.

The EU market as a destination for the ground fish species is especially important for the cod. This is primarily the case for Atlantic cod, but a large part of the available supplies of Pacific cod also has the EU market as its final destination. In 2014, 82% of the Atlantic cod ended up in the EU while approx. 18% of the Pacific cod were consumed in this market. Nearly 1.1 million tonnes of different cod products ended up in the EU market in 2013. The main suppliers are Norway, Iceland, Russia, the Faroe Islands and China. The fish from China is of European origin as large volumes of frozen cod are shipped from Europe for further preparation and end up in the EU market.

47 %

14 %12 %

9 %8 % 7 %

2 %

5 %

0 %

5 %

10 %

15 %

20 %

25 %

30 %

35 %

40 %

45 %

50 %

EU North America Asia Russia South America Japan Africa Others

Source: Kontali Analyse

The global volume of groundfish - Where is it consumed? (2014 E)

38 %

82 %

18 %

46 % 45 %

52 %

29 %

0 %

47 %

0 %

10 %

20 %

30 %

40 %

50 %

60 %

70 %

80 %

90 %

100 %

AlaskaPollock

Atlantic cod Pacific cod Haddock Saithe Hake Hoki SBW Total

Source: Kontali Analyse

Share of total global catch consumed in the EU in 2014 E

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A large share of the other ground fish species fished in the Atlantic Ocean like haddock and saithe also ends up in the EU market. Between 40% and 50% of the total catches of haddock, saithe and hake end up in the EU market. This is perhaps not so surprising for saithe and haddock, as all of this is caught in the North Atlantic. But for hake, where less than 10% of the global catch comes from “European waters”, it is the strong Spanish, and to some extent French, preference and demand for hake that is the main driver behind this trade flow. The figure below shows an estimated breakdown of whitefish consumption in the EU. These figures are not 100% accurate, but estimates based on trade and catch statistics.

How is the fish consumed in different countries?

There are other characteristics of the European markets, apart from these species preferences, which for instance distinguish the French market from the German, the Portuguese market from the Spanish etc.

Germany is perhaps the market in Europe where sales of fresh or chilled fish have the lowest representation, with a correspondingly high share of retail distribution being as frozen fillets and fillet portions. This is not the case only for white fish, but also for other seafood.

The Spanish market is more diversified when it comes to white fish products. Large supermarkets such as Carrefour, Alcampo and El Corte Ingles offer a wide range of frozen, fresh and processed products.

In the UK there it is mainly frozen fillets and value-added products such as breaded and battered products that are to be found on the fish counter.

White Fish Cod Alaska Pollock Haddock Saithe Hakes HokiTotal

Germany 547 70 411 3 23 36 4UK 474 250 101 86 15 20 2Spain 473 190 32 0 6 245 0France 359 60 183 13 26 55 22Scandinavia (SE, DK, FI) 245 134 26 23 40 10 12Poland 243 97 109 7 6 13 11Be/Ne/Lux 237 89 71 17 32 26 2Portugal 162 98 5 0 0 59 0Italy 158 44 30 0 0 84 0Others 115 45 57 3 5 3 2

3013 1077 1025 152 153 551 55

Top 3 Markets1 Germany UK Germany UK Scandinavia Spain France2 UK Spain France Scandinavia Be/Ne/Lux Italy Scandinavia3 Spain Scandinavia Poland Be/Ne/Lux France Portugal Poland

Source: Kontali Analyse

1000 tonnes R.W.

EU country split - whitefish consumption 2014

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In France we find fresh and frozen fillet products as well as a variety of value-added consumer packages.

In Portugal and Italy there are mainly conventional products such as salted and dried white fish.

Clipfish, photo K. Gjertsen Dried fish/stock fish, photo: Mediebank, Brandmaker

2.2 Consumption of white fish from aquaculture – By main markets

Globally, approximately 10 million tonnes of white fish are produced from aquaculture. Between 45% and 50% of this is consumed by the Asian producing countries. The existence of strong white fish consumption in Asia, Latin America and Africa is a result of substantial domestic production also having built up local markets. The North American market also plays an important role for both catfish products and for tilapia. Tilapia is the main aquaculture product in the US, being primarily supplied as frozen fillets from various Asian producing nations, as well as a steady flow of fresh airborne fillets entering the market from Central and South American producers.

45 %

13 %11 %

9 % 8 %

1 % 2 %

12 %

0 %

5 %

10 %

15 %

20 %

25 %

30 %

35 %

40 %

45 %

50 %

Other Asia Africa NorthAmerica

Latin America EU Russia Japan Other

The global volume of the selected aquaculture species - Where is it consumed ?(2014 Est.)

Source: Kontali Analyse

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The EU market has been the main destination for the local aquaculture species European seabass and Gilthead seabream, for local marine species such as cod and corvina/meager, as well as the higher priced flatfish species turbot and halibut. It has also been the most important export destination for the pangasius farmed in Vietnam, resulting in a growth in farmed white fish volumes going into the EU in the last decade. It is especially the fillet products which have shown a strong growth to this market. The supply of frozen fillet products from white fish to the EU markets was approx. 520,000 tonnes in 2000. In 2014 the volumes had increased to approx. 930,000 tonnes.

The figure above shows that Asia is the largest white fish consumer, when we include products from both fisheries and aquaculture. Over 5.8 million tonnes of white fish products were consumed in Asia (other Asia + Japan) in 2014. The consumption in the EU was close to 3.9 million tonnes.

0

5

10

15

20

25

30

35

401000 tonnes Fresh water fillets import EU 2014

Tilapia fillets

Pangasius fillets

Source: Kontali Analyse

0

1000

2000

3000

4000

5000

6000

Other Asia EU NorthAmerica

Africa Latin America Russia Japan Other

Estimated distribution of Consumption - 2014ESelected white fish Species from Fisheries & Aquaculture

White fish from Fisheries

White fish from Aquaculture

Source: Kontali Analyse

1000 tonnes

31%

12%

23%

9% 8%4% 4%

10%

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2.3 How are the white fish species sold and marketed?

A growing trend is a greater demand for fillet and fillet products. In 2014 52% of the total ground fish species were sold as frozen fillets either singly or in blocks.

Whole frozen white fish accounted for 19% of total sales in 2014. A large part of the whole white fish products like Atlantic cod and Alaska pollock is distributed to China and the Eastern European countries for further preparation and ends up in the EU and the US markets as frozen fillets.

The EU market is a large consumer of fresh whole fish and fresh fillets. But with a low level of self-sufficiency in seafood, it is dependent on imports from other nations. The fresh fish is mainly supplied from Norway, Iceland and the Faroe Islands. The fresh fish segment constituted approx. 7% of the total ground fish markets in 2014.

The salted dried (clipfish) and stockfish products made from cod and saithe mainly from Norway and Iceland are sold in traditional markets in Portugal, Spain, Italy, Brazil and African countries. These markets have long traditions of consuming such products. In 2014 approx. 9% of the total ground fish species were sold salted or dried.

5 %2 %

9 %

52 %

19 %

9 %4 %

White fish product share

Fresh

Fresh Fillets

Salted dried / Stockfish

Frozen fillets / Blocks

Frozen whole

Surimi

Other PreparedSource: Kontali AnalyseSource: Kontali Analyse

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2.4 Price comparison main commercial white fish species As the figure below demonstrates, Atlantic haddock was the most expensive white fish species in the selected range in 2014. Even though the Alaska pollock is the most valuable species, it is relatively far down on the price ladder compared to the more expensive species. Tilapia and pangasius, the main species from aquaculture, are also found near the bottom of the ladder. In 2015 Atlantic cod has switched places with haddock at the top of the ladder, which is the normal situation when we look at historic prices.

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3 Availability & Management of whitefish/groundfish resources

3.1 Total allowable catch (TAC)

The total allowable catch (TAC) is the catch limit which applies to the largest commercial fishing stocks. The fishing stocks are increasingly subject to regulation and monitoring and many of the most important ground fish species are strictly regulated. The figures shows TAC for the selected white fish species in total compared to total catch for the same species. Since 2006 it appears that the total catches have been below the total TAC. After some years with decreasing ground fish resources, both TAC and catches increased in 2011 and the subsequent years. TAC and catches in 2014 then remained stable compared to the year before.

5.000

5.500

6.000

6.500

7.000

7.500

8.000

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

1000 tonnes Catch vs TAC, main commercial white fish species

TAC Catch

Source: Kontali Analyse, FAO, National statistics

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The TAC for haddock has dropped every year since 2012, while the saithe quota decreased from 2013 to 2014. The Alaska pollock quota and the Atlantic cod quota have increased in recent years. However, a slight decrease in the Atlantic cod quota is expected this year, but the quota will remain high for many years because of a strong resource situation.

3.2 Resource Management Determination of quotas for species in the North Atlantic

In the last 30 years there has been a change from almost free access to our common fishery resources towards a regulated industry with quotas and restrictions on access to fisheries.

Each nation’s quota is decided on the basis of an agreed TAC (Total Allowable Catch) which the fishery nations decide through their common fishery agreements. There are annual negotiations on quotas for the various species. The agreement establishes and regulates the amount of the given quota that each country can fish in its respective zone.

The national quotas are distributed by each nation between the different fleet groups and down to vessel level.

ICES – (International Council for the Exploration of the Sea) The International Council, ICES is an independent, scientific organisation which provides advice on the allocation of fishing quotas (TAC)

ACFM (Advisory Committee on Fisheries Management) is an advisory committee under ICES. ACFM collects scientific background material from the member states and provides annual advice on sustainable catches of major fish species in the northeastern Atlantic Ocean. Based on this advice, each fishing nation, together with its relevant negotiating partners, determines the size of the annual total quotas for the various species. Great importance is attached to advice from ICES.

Norway – Russia The largest fish stocks in the Barents Sea have a distribution covering the Norwegian and Russian

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zone and the fisheries protection zone around Svalbard. The most important common stocks are the Norwegian Arctic cod, Norwegian Arctic Haddock and capelin. Norway and Russia have established a joint Norwegian-Russian Fisheries Commission where the quotas in the Barents Sea are determined annually by Norway and Russia. Total quotas set by Norway and Russia in the Fisheries Commission are based on the recommendations on taxation levels prepared by ICES.

In addition to Norway and Russia, the EU, the Faroe Islands, Greenland and Iceland are also allocated quota shares in the Barents Sea through bilateral quota exchange agreement with Norway and Russia.

Norway - EU Norway and the EU have annual quota negotiations on Norwegian and EU fisheries covering shared and exclusive stocks in the North Sea, Norwegian fishing west of the British Isles and in Greenland and EU fishing in the Norwegian economic zone in the Barents Sea. Norway - Faroe Islands Following an agreement signed in 1979, Norway and the Faroe Islands have an annual quota agreement for the exchange of fishing quotas in each other's economic zones. The agreement regulates the exchange of quotas on exclusive populations.

Norway - Greenland Following an agreement signed in 1991 Norway and Greenland established on annual quota agreement regarding fishing in each other's economic zones.

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3.3 Fisheries in the northeastern Atlantic Ocean The map shows fisheries zones in the Atlantic Ocean.

Source: Directorate of Fisheries

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3. 4 Seasonal variations for different species

There are variations in seasonal catch pattern between the various species. One third of the total whitefish catch is landed during the first three months of the year. Alaska pollock, Atlantic cod, saithe, and Pacific cod have their main season in the beginning of the year, while haddock and hake are more evenly distributed throughout the year. The main hoki season is May-July, with a slight increase also in December.

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

Jan Feb March April May June July Aug Sept Oct Nov Dec

Monthly share of total catch

Pollock Hake At. Cod Haddock Saithe Pac. Cod Hoki

Source: Kontali Analyse

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4 Fishing gear

4.1 Conventional and ocean-going fleets Conventional fleets (coastal fishing fleets) operate near the coast, often using ordinary and traditional fishing gear. They include vessels under 15 metres. There are also some larger coastal vessels that might operate far from the coast. Conventional fleets sell to nearby production facilities and mainly deliver the catch fresh.

Ocean-going fleets have larger and more capital-intensive vessels. Equipment used by ocean-going fleets (above 20 metres) includes trawls, seines and hook-and-line gear. These vessels can travel considerable distances to deliver their catches. Trawlers might deliver their catches fresh/chilled on ice or/and frozen depending on the equipment on board. Some vessels have factories to process and freeze the fish in consumer packaging on board. Ocean-going fleets help fishing plants to maintain stable deliveries of fish all-year-round.

4.2 Fishing gear There are many different types of fishing gear. Some are adapted to certain species on the basis of the species’ special characteristics, such as their behaviour or their feeding, spawning and migration patterns. The main types used in Norwegian waters are gillnet (bottom-set gillnet, midwater gillnet and drift net), hook-and-line gear (lines, jigging and trolling lines), trawls (bottom, pelagic and semi-pelagic trawls), seines (Danish and Scottish seines), closing nets (purse seines, shore seines) and other fishing gear (such as lobster/crab pots, fish traps and shell scrapers).

The main groups of fishing gear are divided into passive and active gear. With Passive fishing gear, the fish must seek out the gear in order to be caught, such as longlines and gillnets, whereas active fishing gear has to seek out the fish in order to catch it, such as trawls, closing nets and seines.

Gillnet Gillnet fishing has a long tradition. Today it constitutes the most important fishing method for much of the Norwegian fishing fleet. Gillnets are principally used by the coastal fishing fleet, but also by larger ocean-going vessels. Fish generally caught in gillnets include cod, saithe, Greenland halibut, redfish, ling and monkfish.

A gillnet is roughly speaking a piece of net (mesh) with floaters attached to the top and weights at the bottom. A distinction is made between various types of gillnet fishing, such as bottom-set gillnet fishing, midwater gillnet fishing and drift-net fishing.

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Illustration of a chain of gillnets (Directorate of Fisheries/ NPD)

Coastal gillnet fishing vessel (smack)

Ocean-going gillnet fishing vessel (combined longline and gillnet)

Illustration of net fishing vessels (Directorate of Fisheries/ NPD)

Hook-and-line gear Hook-and-line gear is a term used for various types of fishing gear which can be divided into two main groups: “longlines” and “trolling lines”. The longlines category contains a number of variants such as mid-water lines, stake lines, boulters, bottom-set longlines, etc.

There is a long tradition of fishing with bottom-set longlines in the Norwegian fishing fleet, and it is an important type of fishing gear for both the coastal fleet and the ocean-going fleet. The main species for which longline fishing is used are cod, haddock, Greenland halibut, ling, tusk and catfish.

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Illustration of a longline during hauling (Directorate of Fisheries/ NPD)

Longline fishing itself takes place in basically the same way as gillnet fishing, though with greater differences between the ways in which coastal vessels and ocean-going autoline vessels fish. On an average 4-6 week trip, an ocean-going autoline vessel is usually in operation 24 hours a day, seven days a week. An autoline vessel sets and hauls between 30,000 and 50,000 hooks per day. It is not usual to set all the hooks on one stub (35 – 40 nautical miles). The stubs are usually divided into lengths of 8 – 10 nautical miles. Some fisheries divide the stubs into even shorter rows, increasing the number of stubs in the area.

A coastal vessel may also operate on a 24-hour basis using an autoline (automatic baiting), but their trips are shorter (from one to a few days) because of the need to deliver fresh fish. However, most coastal line fishing is based on manual baiting on shore. The vessel will bring ready-baited lines to the fishing grounds and set the line in one or more stubs. After leaving the lines in the water for some time (variable), the line is hauled in and the vessel returns to shore.

Jigging A jig is a hand line with a weight at the end and hooks attached to the line above the weight. The number of hooks varies. Jigging with a hand-held jig still takes place, but this type of fishing is now largely mechanical, using a mechanical jig. This operates by hauling in some of the line and then letting it out again – a process that is repeated until the fish load reaches a certain pre-set value, at which point the jig is then hauled to the surface.

Photo of vessel cod fishing with mechanical jig (Directorate of Fisheries/ NPD)

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Trawling A trawl is a tunnel-shaped fishing net which is towed through the water. The water strains out through the mesh, trapping the fish and retaining them in the end of the trawl.

Historically, trawling is a new method, having started about 100 years ago. Since then there has been significant development in terms of methods and equipment, particularly with regard to the size of the trawl and specialisation according to the species to be caught. Fish behaviour, seabed conditions, selection devices (grating and mesh selection) and the vessel’s engine power are all considered. The pulling speed during trawling ranges from 1.5 knots to 5 knots. Smaller shrimp trawlers travel at the lowest speed, while larger whitefish trawlers and pelagic trawlers travel at the highest speed.

Sorting grid One element in trawling is a sorting grid, which is used to avoid catching fish under the minimum size. Two grids are attached to the opening of the trawler bag so that fish below a particular size go back to the sea, while larger fish are caught. Two main uses of trawls have developed: bottom otter trawl and pelagic trawl. In addition, there is a midway solution referred to as semi-pelagic trawl.

A bottom otter trawl is a trawl which is towed along or close to the seabed. The trawl’s contact with the seabed is in principle limited to the yaw (bobbin chains, rock hoppers or lighter rigging) and trawl doors (otter boards). The trawl itself consists of a few main components such as the cod end (trawl bag), extension and trawl net. Floats are attached to the upper and foremost part of the trawl net to provide buoyancy and to keep the trawl open. The bottom front part of the trawl net ensures that the yaw is in contact with the seafloor.

Two trawl doors, to the front of each side of the trawl, keep the trawl open horizontally when towed by the vessel’s trawl wire, which is attached to the trawl doors. The largest doors used today (shrimp trawl doors) weigh 4,000 – 6,000 kilos each and have an area of 10-15 square meters. The extension of the trawl and how far behind the vessel it is towed both depend on the depth and type of trawl.

Bottom-otter trawls are further divided into three main groups: A single bottom otter trawl is characterised by having one single trawl net towed by one vessel. The trawl net is kept open by two trawl doors. The size and extension of the device vary significantly.

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Photo of a stern trawler and illustration of a single bottom trawl (Directorate of Fisheries/ NPD)

An otter twin bottom trawl is characterised by having two trawl nets rigged next to each other horizontally and towed by one vessel. The trawl nets are kept open by two trawl doors. There is also a weight between the trawls. The size and extension of the equipment may vary. The vessel’s manoeuvrability will be somewhat limited compared to that of a single bottom trawl. This type of trawling is sometimes used when trawling for cod, haddock, saithe and shrimp.

Photo of an otter twin bottom trawl and illustration of a double bottom trawl (Directorate of Fisheries/ NPD)

Pair bottom trawling is characterised by two vessels towing a trawl net between them. The opening of the trawl net is regulated by the distance between the two vessels, and so trawl doors are not used. When the nets are hauled in, both trawl wires are transferred to one of the vessels. Pair bottom trawling is a technique that is not used much by Norwegian vessels.

In addition to the bottom trawling groups described above, there is another type of bottom trawling carried out in the North Sea. This group of trawlers and the trawling device itself is referred to as a beam trawl. The target species for this type of fishing include various types of flatfish. Beam trawling is only used by non-Norwegian vessels. The fishing method is characterised by two smaller trawls being towed or, more precisely, dragged after the vessel on each side.

Photo of a typical beam trawler and trawling rig towed by the vessel (Directorate of Fisheries/ NPD)

Seines Seine fishing is a method which shares many of the characteristics of trawling, but which does not employ trawl doors. The difference between trawls and seines is that the trawl is towed through the water whereas seines are ideally hauled through the water. There are two types of seine fishing; Danish seine and Scottish seine.

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Norwegian fishermen use the Scottish variety. Seine fishing in Norway usually takes place in the north of Norway. The extension and length of the lines vary with depth and seabed conditions.

Danish seine is a type of seine fishing in which the vessel is anchored when hauling in the seine after it has been set. This is a method frequently used by Danish vessels in the North Sea.

Scottish seine is a type of seine fishing that does not involve an anchor buoy; rather, the vessel is kept stationary using engine power during the hauling process. Fishing is done by launching a buoy. The vessel then feeds out a rope and launches the seine before the last piece of rope (arm) is set. Once the seine has been set, the buoy is taken on board and the hauling commences, whilst the vessel retains its position by means of engine power. Purse seine fishing has been and still is an important fishing method in Norway. There have been major developments in purse seine fishing, from cotton-thread seines and small vessels using hand power to haul in the seine, to large vessels where the hauling of significantly larger seines has been mechanised. Modern purse seine vessels are among the most efficient fishing vessels in Norway today in terms of the number of different species they catch (herring, mackerel and capelin). Many of these vessels may also be combined with pelagic trawls and some bottom trawls to catch sand eel and Norway pout.

Illustration of a purse seine cast around a school of fish (Directorate of Fisheries/ NPD)

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5 Sustainable fisheries and health issues

5.1 Sustainable catch of a natural resource The term sustainable is generally defined as “a use or development that meets the needs of the present without thereby compromising the ability of future generations to meet their own needs”. In fisheries management, this can be interpreted as continuous harvesting of viable stocks (Fisheries.no/ The Norwegian Ministry of Fisheries and Coastal Affairs).

In November 2011 the entire Norwegian Fishery for cod and haddock was certified by the Marine Stewardship Council (more information below).

TAC The most important element in a sustainable fishery is regulation of fishery based on examination of the stock; “Total Allowable Catch – TAC”. Please see chapter 3.1 for more information on TACs.

By-catch and discard of fish By-catch and discard of fish can be found in fisheries all over the world. Even though many countries have already passed regulations aimed at reducing discard and dealing with by-catch, these continue to be a major challenge around the world. In general there is an international consensus that discards are not consistent with sustainable management of resources. Globally, there are a number estimates for discards. In Norway there is a discard ban, and regulations are also enforced in order to prevent unwanted by-catch. EU fishermen, on the other hand, are obliged to discard fish for which they do not have quotas, but the EU has now proposed a reform with the aim of banning discards. Sorting grid The main object of a sorting grid is to prevent recruits and undersized fish from being caught, while keeping by-catch to a minimum. Please see chapter 4.2 for more information about sorting grids.

5.2 Fishing gear – impact on the environment Gillnets: The anchoring of bottom gillnets may cause damage to coral formations, but the fishing gear itself is passive and there is less chance of damage than when fishing with active gear. In recent years, however, there has been a negative focus on gillnet fishing as a result of lost gillnets being left in the ocean where they continue to catch fish for years (also known as ghost-fishing). This entails a hidden exploitation of available resources and contamination of the marine environment, since modern gillnets are made from synthetic fibres that do not disintegrate in the ocean. Gillnets may be lost due to difficult seafloor conditions and bad weather.

Trawling: Trawling is strictly regulated in most waters. However some believe that bottom trawling is detrimental to the environment, with a focus on three areas in particular:

• Since bottom trawling involves towing heavy gear along the seabed, this method can damage the seafloor and the sea-life that exists there, and concerns have been expressed about coral reefs, among other things. However, there has been considerable focus on this over the last decade, and the government, fishing companies and research companies have helped to bring about a change in fishing areas. Fishing gear has also been developed that is intended to substantially reduce damage to the environment (see below for more information about the protection of coral reefs).

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• An earlier problem was that trawl nets were not selective in terms of fish size, but here too an

increased focus has resulted in the development of equipment which sorts out unwanted fish (e.g. sorting grids).

• Fuel consumption for trawlers is greater than for coastal vessels with lighter, passive gear. However, fuel consumption has been noticeably reduced over the last decade as a part of an effort by companies to reduce their fuel costs and environmental impact. The opportunity of having four quotas (up from three in January 2015) might also reduce fuel consumption if it resulted in fewer vessels in operation. Trawling also produces a greater quantity of produced tonnes of food per m3 diesel.

Hook-and-line: Hook-and-line is often recognised as an environmentally-friendly fishing method because it is selective in terms of species and sizes. While corals may be damaged by anchoring and by the bottom-line, the fishing gear itself is passive and there is less chance of causing damage than when fishing with active gear. The vessels used produce a good quality catch and have relatively low fuel consumption. World-wide, however, a large number of sea-birds get caught on the hooks and drown, and for this reason hook-and-line vessels are being monitored by environmental organisations and government agencies.

Seines: Seine fishing is a method which shares many of the characteristics of trawling, but which does not employ trawl doors. The trawl is hauled through the water (not towed as with trawlers). The gear can damage the sea-floor and the sea-life that exists there and the ropes used can also cause damage. However, seines have less damage potential to vulnerable ecosystems than trawlers.

5.3 Protecting coral reefs According to the Directorate of Fisheries nine coral reefs have specially protection. All fishing with bottom-dragging equipment is forbidden in these areas. The implementing rules also state that special care must be taken when fishing in the vicinity of known coral reefs (the duty of care).

5.4 Programmes and certifications

CRISP and MAREANO Both Norwegian and international research institutes are constantly working to find ways of improving fishing gear, quality and other issues that result in environmental gains. The Institute of Marine Research in Norway has two programmes:

• CRISP is a centre for research-based innovation that was set up to develop smarter technologies to meet future challenges for a sustainable and economically viable fishing industry. CRISP will focus on two main modes of industrial fishing and their products, these being trawling and purse-seine fishing. Some 90% of total Norwegian landings (by weight) are caught using these types of gear. The centre aims, by means of this initiative and research strategy, to transform fisheries technology and bring the industry a big step closer to a reduced environmental impact and improved food quality.

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• MAREANO charts depth, bottom conditions, biological diversity, natural resources and pollution

in Norwegian coastal and ocean areas. This programme also issues guidelines for the protection of coral reefs.

Marine Stewardship Council (MSC) Catches of cod, haddock and saithe from Norwegian Fisheries are certified under the Marine Stewardship Council (MSC) standard for sustainable fisheries. The MSC standard was established in 1997 and it is now globally the most widely recognised environmental standard for seafood. It allows seafood to be tracked back through every part of the value chain to the sustainable fishery where the fish was first caught.

MSC environmental standards are based on three main principles: 1. Fisheries must be managed in a way that prevents fish resources from being over-fished or

exhausted. 2. Fishery structure, production and function must be adapted in order to maintain the diversity in the

ecosystem. 3. Managers of fisheries must comply with local, national and international laws and guidelines, as

well as the framework that provides for responsible and sustainable fisheries management.

KRAV KRAV is Sweden’s most widely recognised standard for organic food, providing certification for several products. Seafood certified by KRAV includes cod, haddock, shrimp, saithe and herring, as well as organically-farmed salmon, trout and cod. KRAV certification demands sustainable fishery and fishing gear that minimises by-catch while caring for the environment. There is compliance with recommendations from ICES.

Friend of the Sea (FOS) is an environmental standard founded by Dr. Paolo Bray which has certified over thirty fisheries. FOS is the only certification that also covers harvesting and the production of fish meal and omega-3 fish oils. FOS makes the following demands for certification: no over-fishing, no by-catch of endangered species, fisheries must comply with laws and regulations and fisheries must gradually reduce their carbon footprint.

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5.5 Megatrends – Health, convenience, environment and ethics Megatrends are often defined as external factors that form a basis for and affect human actions. From a food perspective there are four megatrends that are of particular significance: health, convenience, environment and ethics. People are focussing increasingly on their health and are now more interested in organic food and environmental sustainability. Fish are an important source of protein, vitamins, minerals and omega 3 oils. Fish as a resource is able to counteract a major threat to health in the western world – unhealthy diet. With regard to environment and ethics, many fisheries aim to achieve sustainability, though there are many challenges in terms of the legal harvesting of fish, discards etc. around the world. The MSC standard and other forms of certification help by rewarding those fisheries that focus on sustainability. With regard to convenience, fish can be easy and quick to prepare. An increasing number of producers are also making products and packaging that allow anyone to prepare a good meal quickly and easily. Very often a lack of knowledge of how to prepare fish is a barrier to fish consumption, and communication from the fishing industry/producers can encourage even more people to eat fish.

5.6 Nutritional benefit from eating fish White fish like cod, haddock and saithe are low fat, high protein products. The FAO stresses that “Fish is food for the brain as well as good protein. Fish is a food of excellent nutritional value, providing high quality protein and a wide variety of vitamins and minerals, including vitamins A and D, phosphorus, magnesium, selenium, and iodine in marine fish. Experts agree that, even in small quantities, fish can have a significant positive impact in improving the quality of dietary protein by complementing the essential amino acids that are often present in low quantities in vegetable-based diets.”

Photo: Andre Steffensen

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5.7 Environmental influence The harvesting of fish does not entail any consumption of feed or freshwater. Harvested fish do not require any feed, whereas producing 1 kg of beef requires 8 kg of feed. Neither do harvested fish require added freshwater, whereas producing 1 kg beef requires 14,000 litres of freshwater. The small amount of biocide used in fishing is present in the antifouling used on the hulls of fishing vessels.

Source: Prof R. Hilborn, Univ of Washington

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6 Industry structure for important fishing nations

6.1 Industry Structure The structure of the seafood industries varies among the different fishing nations. The composition of a nation’s fishing fleet and production industry is often a result of historical structures which might have been decided by governmental regulations, but the structure might also come from a time when access to the resources was more free and without a strong system of regulation. These structures are often affected by seasonal variations, vicinity to the resources, settlement pattern, catch pattern etc.

Today, every nation basically has control over its allocated quotas and of the fishing rights in its economic zone. The regulations for the fisheries are decided by each nation after the allocation of quotas. The fishery rights are increasingly limited to fewer players and the fisheries and fishery rights are subject to ever-increasing regulation.

Some nations have a very fragmented industry consisting of a many smaller, middle-sized and large independent participants both in the fleet segment as well as on the landside. Others have fewer and larger participants with a large degree of integration between the fishing fleet and the industry.

The Norwegian industry must be considered as fragmented, even though there have been large structural changes the latest 25 years. The fleet consists of many small and medium sized coastal vessels fishing with conventional gear, landing the majority of the ground fish species in Norway according to a seasonal fishing pattern following the availability of fish along the coast. The number of trawlers has decreased in recent decades, but trawlers still play an important role together with the coastal fleet in supplying the industry with raw material as the share of the catches remains the same. All fish from trawlers are also landed in Norway, but trawlers do not have to deliver in a seasonal pattern as they can follow fish through its migration pattern. There are also a number of actors on the landside. There are approx. 180 active fish buyers in Norway which process the fish to some degree for distribution mainly to foreign markets.

The Norwegian sale of fish at first hand is regulated through the Raw Fish Act (Råfiskloven) which states that all first hand sales must be carried out through one of the six sales companies which are owned by the fishermen.

In USA there is a large degree of integration between the fleet and the industry. The total number of vessels in the US fishing fleet is approx. 20,000, but these are mainly owned by a couple of large and international companies. These companies control the whole value chain from catch to export.

The Icelandic structure is very similar to the Norwegian structure, but with fewer participants and some limited vertical integration through the value chain

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Source: Kontali Analyse

Norwegian quota cod, haddock, saithe:779 000 mt

Quota Holders: Share of quota:Havfisk AS 10 %Nergård Havfiske AS 5 %Prestfjord AS 2 %Roaldnes Group 2 %Strand 2%Volstad AS 1%Andenes Havfiskeselskap AS 1 %Engenes Fiskeriselskap AS 1 %Rosund Drift AS 1 %Ramoen AS 1 %Share 10 largest 26 %Share 40 largest 41 %

180 Active white fish buyers • Packing Plants

• Fresh Processing• Conventional Industry

• Traders

Norwegian Exports14.9 Bill. NOK

Country: Share of Norwegian COD,HAD POK export

value:Portugal 17 % China 14 % Denmark 12 % UK 9 % Brazil 8 % France 4 % Poland 3 % Italy 3 % USA 3 % Others 26 %

Norwegian Exporters

Industry Structure Norway

Norwegian Fleet

First Hand Sales

Exports

Import/Markets

US quota Pacific cod, Alaska pollock, hake:1 985 000 mt

Quota Holders: Share of quota:Trident Seafoods 26 %Maruha Nichiro 21 %American Seafoods Company 16 %Nissui 15%Arctic Storm 7 %Pacific Seafoods 6% Share 6 largest 90 %Share Others 10 %

Industry Structure US

US Fleet

First Hand Sales

Exports

Import/Markets

Integrated

Integrated by qouta holders• Coldstores/Landing terminals

• Processing• Conventional Industry

US Exports9.2 Bill. NOK

Country: Share of US white fish export value:

Japan 20 % China 20 % Germany 19 % South Korea 17 % Netherlands 8 % France 3 % Spain 2 % Canada 2 % UK 2 % Portugal 1 %Others 7 %

Salted Clipfish Frozen Fresh FilletsNumber of exporters

55-60 60-61 60-65 65-70 60-65Top 16-80% Top 9-80% Top 12-80% Top10-80% Top 6-90%

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Source: Kontali Analyse

Icelandic quota cod, haddock, saithe:328 000 mt

Quota Holders: Share of quota:HB Grandi hf 7%Samherji 6%Þorbjörn hf 5%Visir hf 5%FISK-Seafood hf 4%Rammi hf 4%Skinney-Þinganes hf 3%

Vinnslustöðin hf 3%Hraðfrystihúsið - Gunnvör hf 3%Útgerðarfélag Akureyringa ehf 3%Share 10 largest 44 %Share 40 largest 78 %

300 Active white fish buyers • Packing Plants

• Fresh Processing• Conventional Industry

• Traders

Icelandic Exporters

Industry Structure Iceland

Icelandic Fleet

First Hand Sales

Exports

Import/MarketsIcelandic Exports

7.6 Bill. NOK

Country: Share of Icelandicwhite fish export value:

UK 20 % France 14 % Spain 13 % Germany 8 % USA 8 % Nigeria 6% Belgium 5 % Netherlands 5 % Portugal 4 % Other: 17 %

Russian quota pollock, cod, haddock:2 140 000 mt

Quota Holders: Share of quota:Murmansk Trawl Fleet 8 %Arkhangelsk Trawl Fleet 7%Rybprominvest 5%Alternativa 4%Karat - 1 4%SOGRA 3%Murmanseld 2 3%Virma 3%Yeridan 3%Feniks 3%Share 10 largest 43%Share 40 largest 82%

Russian Exports8.8 Bill. NOK

Country: Share of Russianwhite fish export value:(COD, HAD, APO)

China 51 %EU 29 %South Korea 19 %Other 1 %

Industry Structure Russia

Russian Fleet Far EastA. pollcock, Pac. cod, Pac. halibit,

Gr. halibut

Import/Markets

Quota Holders: Share of quota:Okeanrybflot 10%NBAMR 7%Preobrazhenskaya 6%TURNIF 5%Ostrov Sakhalin 4%Sakhalin Lizing Flot 4%Dalmoreproduct 4%Vostokrybprom 4%Akros 4%Intraros 3%Share 10 largest 51 %Share 40 largest 82 %

Russian Fleet N. WestAtlantic cod & haddock

First Hand Sales

Exports

Integrated

Integrated by qouta holders• Coldstores/Landing terminals

• Processing

25-30 Exporters

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7 Norwegian fisheries – quotas, structure, regulation, and prices

7.1 Distribution in Norway – conventional coastal and ocean-going fleet

Since 1990 the Norwegian Arctic cod quota has been divided into two main groups: vessels fishing with conventional gear and trawlers. (Please see chapter 4.1 for more information about the conventional and the ocean-going fleets). The so-called “trawl ladder” is dynamic, as the two groups’ respective shares vary according to the size of the total quota.

A low total quota favours the coastal vessels (conventional gear), while the share allocated to trawlers increases once the TAC reaches a certain level. For a number of years the Norwegian quota varied between 200,000 and 300,000 tonnes while the trawlers’ share was 31%. Since 2011 the Norwgian cod quota has exceeded 300,000 tonnes and the trawlers’ share of the quota has increased to 33%.

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Norwegian fishing fleet Norway has a fragmented fishing fleet consisting of more than 5,900 registered vessels. A large part of the fleet consists of coastal vessels of less than 15 meters.

In 2014 there were approx. 9,398 fishermen registered with fishing as their main occupation and approx. 1,918 registered with fishing as secondary occupation.

The figure below shows the development in the number of trawl vessels in Norway. The number of trawl vessels has decreased sharply since the mid 1980s. In 2014 there were 37 registered cod trawlers in Norway.

Active fishing vessels by lenght - Norway - 2014

< 10 10 - 11 - 15 - 21 - 28 - TotalNumber of fishing vessels 3.204 1.510 689 150 130 251 5.934Source: Fiskeridirektoratet

Length in meter

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The 35 largest fishing companies in 2014 (gross catch value in NOK millions)

The Norwegian fishing fleet is fragmented, with most companies having one or few vessels. The largest fishing company is HAVFISK, more than twice as large as number two, the Nergård Group. Both HAVFISK and Nergård use bottom trawls. The next on the list are also mainly trawlers, but some are pelagic trawlers and trawlers using hook and line among the largest fishing companies.

7.2 Regulations – The Fishing Participation Act The Act on the right to participate in fishing (the Fishing Participation Act) No 15 of 1999 is a collective item of licensing legislation on commercial fishing from Norwegian vessels. The definition of commercial fishing is “where an operator conducts fishing as a sole business or in combination with some other trade” (regjeringen.no).

The Directorate of Fisheries can make exceptions when required to do so by “industry or local considerations”. Substantial use has been made of this opportunity in order to issue fishery companies with permits to acquire vessels (and quotas). Where exceptions are allowed, the government may (if justifiable reasons exist) place conditions or limitations on the quotas. Section 9 of the Fishing Participation Act also states that the delegation of shares in a company that owns Norwegian fishing vessels requires the approval of the government.

7.3 First-hand sales The Raw Fish Act The Raw Fish Act, passed in 1938, is the foundation and the premise that enables fish sales organisations to function in this role. An important aim of the Raw Fish Act and the sales

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organisations has been to provide for clear, fair and controlled conditions with regard to fishing and the trading of catches between fishermen and buyers.

Of crucial importance is the exclusive right to sales according to the law. Supervision is the responsibility of the sales organisations, and information regarding sales etc. is supplied to the government, which uses the information for research and to optimise the management of available resources. Fishermen pay for the management of the sales organisations themselves in the form of a fee (0.8% of the catch value).

The Raw Fish Act has been amended a number of times. Today the act and its regulations represent a framework ensuring that fishermen take part in consultations, and contributing to healthy competition, competitive pricing and equal treatment of fishermen and buyers.

Sales organisations The Norwegian Fishermen’s Sales Organisation (Råfisklaget), SUROFI and four other sales organisations handle major national functions in seafood trading and play an important national role in terms of controlling our fish stocks. The sales organisations are engaged in safeguarding the incomes of fishermen. An important premise however is to ensure over time that the ocean's resources are utilised in a sustainable manner, and to achieve profitable growth in the entire fishing industry. Contributing to this social responsibility and development is one of the principles of the organisations.

The sales organisations organise and arrange sales of groundfish that are landed along the coast. Each sales organisation controls a particular area. The Norwegian Fishermen’s Sales Organisation (the largest such organisation) controls landings from Nordmøre in the south-west to Finnmark in the north-east. The most important species are cod, saithe, haddock and shrimps/prawns.

The sales organisations are owned by the fishermen. They have a well-developed service system and offer fishermen and buyers a number of services directly related to trading, sales and payments. Fishermen and buyers can come to direct mutual agreements with regard to supply, catches can be put out for auction on the organisations’ modern electronic auction system, or longer-term contracts can be entered into. The whole system is based on the organisations’ business regulations, a market-based minimum price scheme and an effective payment system that guarantees payments for fishermen.

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7.4 Price settlements Fresh Prices are traditionally agreed directly between fishermen and buyers, often on a day-to-day basis. The minimum price scheme provides a safety net, though sometimes the prices can be higher due to:

• Periods of low supply of fish • Fish of particularly good quality • Stable deliveries resulting in higher prices • Good market conditions

Frozen Frozen deliveries are mainly sold at auctions. These take place in an electronic market-based system and approved buyers listed in The Directorate of Fisheries’ buyer register are able to bid.

When it comes to determining prices for fish that are subject to supply conditions, the price should be an average of the sales in the Norwegian Fishermen’s Sales Organisation district for comparable fish over the last two weeks prior to the sale taking place. Fish sales subject to the supply conditions arrangements for trawlers are not included when determining prices. Unless there are pre-arranged buyers for the fish, the catch is put up for auction and all approved buyers on the open market can bid on it.

The seller can propose an acceptance price, and the buyer with the highest price above this gets to buy the fish. If the seller chooses not to accept the price offered, the catch is returned to them. The buyer with the highest bid under the acceptance price can contact the seller with a request to be contacted if the catch is to be sold. The unsold fish is either sold as a contract sale or in a new auction.

7.5 Fishing areas (Norwegian coast, Barents Sea, etc.) Fisheries for cod, haddock and saithe are located in an area extending from Egersundbanken in the south to Svalbard in the north (the North Sea, the Norwegian Sea and the Barents Sea). Fishing for saithe takes place mainly in the south of this area, while fishing for cod and haddock takes place along the coast of North Norway, Tromsøflaket, around Bear Island and Hopen. Fishing for shrimp takes place further to the east and north in the Barents Sea. Some vessels fish for Greenland halibut in Greenland waters – please see the map. Red-fish is caught around Bear Island and along the edge of the continental shelf southwards from Bear Island to the Norwegian coast.

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Source: E-catch Mgt.

The different fisheries are seasonal. For the trawlers that fish mainly cod, haddock, saithe and to some extent shrimp, redfish and Greenland halibut, the fishing is year-round. The great cod fisheries occur during the period from January to April, with the Lofoten Fisheries being the high point for the coastal fleet. In order to limit the supply of cod during this period, the trawlers fish primarily for saithe, shrimp and redfish in the period from February to July. From July to September/October there is mixed fishing, primarily for haddock, saithe and cod. From October to January fishing is mainly for cod, haddock and saithe.

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Photo: Mehmet Seda Cetin

Photo: Peder Otto Dybvik

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8 HAVFISK HAVFISK ASA is a seafood company that operates 10 trawlers and has 29.6 quotas for cod trawling, representing 33.7% and about 11% of the total Norwegian cod quotas. The company adjusts its operations and management to the given framework. The company’s organisation provides advantages of scale resulting from consistent deliveries of fish and highly qualified employees. HAVFISK ASA’s operating revenue in 2014 was NOK 1,049 million and the company has about 390 employees. HAVFISK ASA is listed on the Oslo Stock Exchange.

8.1 Norwegian quota system – HAVFISK’ quotas There is a total of 87.792 cod trawling licences in Norway, with HAVFISK holding 29.6 of these. In 2015 one cod trawling licence gives the right to catch 1,478 tonnes (round weight) of cod. HAVFISK also holds 29.6 licences for haddock out of the same total of 87.792. One licence gives the right to catch up to 369 tonnes of haddock (round weight). For saithe the corresponding number is 31.9 out of a total of 101.5 licences, which each gives the right to fish 327 tonnes of saithe. For saithe in the North Sea each vessel has the right to fish 500 tonnes per vessel. The North Sea saithe fishery is over-regulated which means that the fishery is stopped when the total saithe quota has been fished irrespective of whether the vessels have fished their individual vessel quota. HAVFISK’s licences are not for further processing of the fish on board. The fish caught is headed and gutted, and then either chilled on ice or frozen.

Obligations Most of the licences, 28.67 of the 29.6, have some obligations attached. The licences give some pre-determined buyers the first right of buying the catch, a so-called “supply obligation. The conditions apply to selected production plants, municipalities or major geographic areas for both cod and haddock fished north of 62° north. These conditions apply to 80% of HAVFISK’s total catch of cod and 60% of the catch of haddock. Compliance with these conditions and the actual sales are both dealt with by the Norwegian Fishermen’s sales organisation, and HAVFISK reports annually the fulfilment to the Directorate of Fisheries.

The Directorate of Fisheries’ regulations for supply obligations for vessels with cod trawling licences prescribe details of the terms. The aim of these regulations is to ensure stable deliveries of fish to processing plants.

The purchasing company concerned must be able to document the processing into fillets of at least 70% of cod prior to resale, this to ensure fulfilment of the intention of the regulations on the buyer’s side.

Practically all fish sold from HAVFISK under the supply obligations are sold to HAVFISK’s sister company, Norway Seafoods, which was part of HAVFISK (formerly known as Aker Seafoods), prior to a split in 2012.

HAVFISK is also under an obligation to maintain production activity in a total of six production facilities in the north of Norway. Five of these are owned by HAVFISK, but operated by Norway Seafoods under a leasing agreement. The same numbers of licences that are under supply obligations are also under this “activity obligation”.

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Higher quota ceiling for cod trawling The government decided on 23 January 2015 to raise the quota ceilings for the cod trawlers, in order to provide for improved efficiency and profitability. Technological progress, changes in the annual quotas and cost and price trends make this both natural and necessary, according to fisheries minister Elisabeth Aspaker in a press release.

8.2Vessel segments HAVFISK operates three types of trawlers:

• Fresh fish trawlers • Fresh fish trawlers with freezing capacity (combined trawlers) • Freezer trawlers

As of August 2015, HAVFISK operates one fresh fish trawler, five combined trawlers and four freezer trawlers.

More information about HAVFISK’s trawlers can be found on our website: www.havfisk.no.

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New trawlers Three new trawlers were delivered in 2013 and 2014. Several of HAVFISK’s trawlers have also been upgraded and rebuilt to make them more efficient and more environmentally effective and to provide attractive workplaces. See information on the entire fleet at www.havfisk.no.

Photo: Peder Otto Dybvik

8.3 Operating pattern A normal operating pattern over the year cycle is as follows:

January/February: Fishing for cod and haddock off the coast of Finnmark and further north in the Barents Sea. As the cod comes close to the shore in the Lofoten area, some of the vessels are moved there. The fresh fish trawlers and combined trawlers normally deliver the most of their catch ashore as fresh product.

February-May: Fishing for saithe off the coast of Møre & Romsdal, on Haltenbanken and in the North Sea. Recently fishing for shrimp and redfish have also been prioritised in this period.

June-August: Fishing for cod and haddock off Finnmark and up to Bear Island. Some of the vessels also fish for shrimp in the Spitsbergen area.

September-December: Fishing for cod, haddock and saithe off Finnmark and towards Bear Island and Hopen Island.

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HAVFISK delivers, compared to the inshore fleet, countercyclical fresh fish

Kongsfjord, photo: Bent Ulleland

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8.4 Products and sales HAVFISK sells all its catches through either the Norwegian Fishermen’s Sales Organisation or the Sunnmøre and Romsdal Sales Organisation. Sales through these channels are mandatory and based on the Norwegian Raw Fish Act.

Approved buyers can then buy the fish from these two sales organisations. The fish harvested by HAVFISK ends up mainly in one of the following three value chains:

1. Fresh fish delivered for onshore processing in Norway. Main customers are fillet producers, with Norway Seafoods as the predominant customer. The fresh fish from HAVFISK’s trawlers are mostly delivered to predetermined buyers under the supply obligation.

2. Frozen fish delivered for onshore processing in Norway. The main customers are clipfish producers.

3. Frozen fish delivered for export to Eastern Europe and China for further processing into various products.

For more information about sales and prices, please see sections 7.3 and 7.4.

Marine residual products HAVFISK produces fishmeal and oil on our newest vessels. The fish oil is produced for human consumption. The fish meal is produced for the aquaculture industry.

HAVFISK has strong focus on using the whole raw material, which includes cod tongues, cod cheeks, head and tail of Greenland Halibut, head of Redfish, cod liver and roe.

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8.5 Crew and expertise In order to work on HAVFISK’s trawlers, every employee must have completed a safety course and obtained a health certificate. To become a skipper, officer or chief engineer, both training and experience at sea are necessary. No formal qualifications are required in order to become a deck boss, factory manager, fisherman or cook, but job experience, references, certificates or apprentice experience are often an advantage in applying for a job on a trawler.

Photo: Atli Hansen, HAVFISK Photo: Erik Kartevoll, HAVFISK

8.6 Safety Safety is one of HAVFISK’s core values, and is a priority for all employees. By mid-2016, the Norwegian government will require ISM (International Safety Management Code) certification for all trawlers larger than 500 Mt, in line with other maritime vessels. HAVFISK has implemented Safety Management Systems as a central tool for improving and securing safety on board all vessels, and is making good progress towards certification in line with ISM.

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8.7 Efficiency and costs in harvesting The profitability of trawler operations is dependent on the size of each vessel’s quotas, the costs of operation and the efficiency of each vessel and its crew. These conditions will be reflected in the cost per kilo of fish caught.

The cost breakdown can be seen in the figure below.

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Crew The largest cost factor for trawlers is the crew. Based on an agreement between the Norwegian Fishing Vessel Owners Association and the crew organisations, the salary is mainly share of catch-based and only a small part of the salary is fixed – the rest being dependent on the catch value. As a proportion of gross revenues, crew costs in 2014 came to approx. 30%. Freight/packaging represents about 10 percent of the revenues. Fuel Fuel costs in 2014 represent around 16% of total revenues. Marine diesel is the main fuel used on Norwegian trawlers. The total cost will depend on the price of fuel and how well the vessels are able to adjust to the different fisheries in relation to the size and capacity of the engines. The volume of fuel is more or less stable, but the price varies with the oil price and the NOK/USD exchange rate. Maintenance and fishing gear In a fully structured trawler fleet with maximum quotas, the vessels will operate year-round, and in areas with tough weather conditions. Consequently vessels and equipment will suffer considerable wear and tear. Maintenance is continuously carried out on board. Unforeseen technical problems may present challenges, but planned ship-yard stays and docking represent the main part of maintenance costs. Total maintenance costs in HAVFISK for 2014 came to about 6% of revenues. Fishing gear represents about 3% of total revenues. Administration costs include overhead costs, administration, insurance etc. and represent 6% of total costs. Catch efficiency HAVFISK has seen an increase in catch efficiency through recent years due to changes in the fleet, availability of fish and increased flexibility to participate in more fisheries.

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9 Outlook The ICES (International Council for the Exploration of the Sea) gave its advice on cod, haddock and saithe quotas in June. The quota advice for 2016 implies a ten per cent reduction in the cod quota. The haddock quota, which increased by 25 per cent at the end of the second quarter, is by ICES recommended to increase by a further 9 per cent in 2016. To retain higher quotas in subsequent years, and for market reasons, industry has recommended to keep the quota on the same level as in 2015.

The recommendation is to increase the saithe quota in the North Sea and north of 62 degrees by approximately 7 per cent overall. Final determination of quotas will be done by the Norwegian authorities during the autumn. ICES does not provide quota advice for these species beyond one year. Predictions beyond one year are therefore difficult to give with any accuracy.

New markets represent an opportunity and as the world’s population increases, prospects for fish are good. There is also an increased focus on the megatrends of health, convenience, environment and ethics – and fish is an important source of protein, vitamins and minerals.

The Tveterås committee Ragnar Tveterås, chair of the Tveterås committee, delivered the seafood industry committee's proposals to fisheries minister Elisabeth Aspaker on 16 December 2014. The committee was set up in spring 2013 with a mandate to look at conditions that might prevent or contribute to increased profitability and value creation in the seafood industry. The committee put forward a number of proposed changes, many of which were controversial including the removal of supply and activity obligations. The proposals will be followed up with a white paper from the Government by the end of the 2015. The aim is for predictable framework conditions that can create profitability in the industry.

With the renewal and upgrading of its fleet, HAVFISK is exploiting its quotas more efficiently and becoming an increasingly attractive employer with more environmentally friendly operations.

Take a virtual tour of Gadus Neptun at: http://invisual.no/havfisk/

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Sources Kontali Analyse HAVFISK ASA Food and Agriculture Organization of the United Nations, FAO The Norwegian Fishermen’s Sales Organisation Wikipedia Directorate of Fisheries Description of relevant fishing gear and fishery activities in the Norwegian economic zone 27.05.2010 Report from the workgroup for protection of corals, 2003 Consequences of fishery activity, May 2008

Norwegian Seafood Council Nofima (Norwegian Food Research Institute) Marine Stewardship Council (MSC)

Useful sources for industry and market information: Directorate of Fisheries www.fiskeridir.no Ministry of Trade, Industry and Fisheries www.government.no Norwegian Seafood Council www.seafood.no FAO www.fao.org SjømatNorge www.sjomatnorge.no The Institute of Marine Research www.imr.no Fiskebåtredernes forbund (Fiskebåt) www.fiskebat.no The Norwegian Fishermen’s Sales Organisation www.rafisklaget.no SUROFI www.surofi.no Nofima (Norwegian Food Research Institute) www.nofima.no International Council for the Exploration of the Sea www.ices.dk

Company address: HAVFISKASA Løvenvoldgt. 11 P.O Box 876 NO – 6001 Ålesund NORWAY Telephone: +47 70 11 86 00 E-mail: [email protected] Web: www.havfisk.no

Disclaimer: While every reasonable precaution has been taken in the preparation of this document, HAVFISK ASA takes no responsibility for errors or omissions, or for damaging resulting from the use of information contained herein. The information contained in this document is believed to be accurate. However, no guarantee is provided.

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APPENDIX

SPECIES

Atlantic Cod (Gadus morhua)

Temperature 8-15°C Habitat Saltwater Diseases in farming Vibrosis, IPN-virus, Francisellosis Maturation At approx. 2 years age, can be postponed by using artificial light Size Can be up to 40 years old. Maximum size is 1.8 meters and 55 kg Diet in the wild Carnivorous Juvenile phase 8-11 months Grow-out 18-30 months - harvest weight (2.5-3.5 kg) Distribution in the wild North Atlantic, incl. the Barents Sea, Baltic Sea and North Sea Fishing gear Conventional gear (net, longline, seine, gillnet), trawl COMMERCIALISATION Utilisation Fresh, whole, fillets, roe, liver, salted/dried

Alaska Pollock (Theragra chalcogramma).

Temperature 8-15°C Habitat Saltwater Maturation 3-4 years of age and 30-40 cm long Diet Carnivorous. Feeds on ground-based seafood such as sand eel, herring and

small salmon Distribution North Pacific Fishing gear Mainly with pelagic nets

COMMERCIALISATION Utilisation Prepared and frozen on board as fillets, industrial blocks, surimi, headed or

gutted or round frozen. Mostly consumed as fillets.

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Saithe (Pollock/Coalfish) (Pollachius virens, Pollachius pollachius)

Temperature 8-15°C Habitat Saltwater Maturation 3-4 years of age and 30-40 cm long Diet Carnivorous. Feeds on ground-based seafood such as sand eel, herring and small salmon Distribution North Atlantic, incl. the Barents Sea, Baltic Sea and North Sea Fishing gear Conventional gear, trawl, closing net Size Saithe can be up to 130 cm and 30 kg.

COMMERCIALISATION Utilisation Fresh/frozen, whole, fillets, salted

Haddock (Melanogrammus aeglefinus)

Temperature 8-15°C Habitat Saltwater Maturation 3-4 years of age and 30-40 cm long Diet Carnivorous. Crustaceans, molluscs, echinoderms and small fish. Distribution Mainly found in the Arctic Ocean, the Barents Sea and as far south as the Bay

of Biscay. Haddock are also found off the coast of Newfoundland and around Iceland.

Fishing gear Conventional gear, trawl Size The maximum size is specified as 19 kg, but rarely greater than 5 kg. Haddock

can live up to 20 years.

COMMERCIALISATION Utilisation Fresh/frozen, whole, fillets

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Pacific cod (Gadus macrocephalus)

Temperature 2-4°C Habitat Saltwater Maturation Diet Carnivorous. Crustaceans, molluscs, echinoderms and small fish. Distribution Eastern and Western regions of the Pacific. Fishing gear Bottom gillnet, bottom seine, bottom trawl

COMMERCIALISATION Utilisation Fresh/frozen, fillets, frozen blocks sold for further processing.

European Hake (Merluccius merluccius)

Temperature 8-15 °C Habitat Saltwater Maturation Female 10 years, male 3-4 years Size Might reach the size of 140 cm and 15 kg, most common at smaller size. Diet Crustaceans, herring, mackerel, sprat Distribution Atlantic Ocean from North Africa to Iceland, Western Atlantic from Labrador

to North Carolina, along the coast of Norway up to the Lofoten area.

COMMERCIALISATION Utilisation Fresh/frozen, fillets

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North Pacific Hake (Merluccius productus)

Temperature 9-15 °C Habitat Saltwater Size Might reach the size of 90 cm and live up to 15 years. Maturation Female at 3-4 years, male at 3 Diet Shrimp, plankton and smaller fishes. Distribution Pacific Ocean from Vancouver Island to the Gulf of California.

COMMERCIALISATION Utilisation Fresh/frozen, fillets

Argentine Hake (Merluccius hubbsi)

Temperature 3-6 °C Habitat Saltwater Size Might reach the size of 95 cm and live up to 15 years. Maturation 6 years Diet Squid, plankton and smaller fishes. Distribution East coast of South America to the Falkland Islands.

COMMERCIALISATION Utilisation Fresh/frozen, fillets

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Pangasius (Pangasius hypophthalmus) Temperature 25-30°C Habitat Freshwater Diseases in farming Subject to a wide variety of diseases: Contracaecum disease

Gymnorhynchus disease, parasitic infestations, Allocreadium disease, Cucullanus infestation

Maturation At 2-3 years Diet in the wild Carnivorous Diet in farming Artificial feed with various combination of plant protein (90%), very little if

any animal protein. Rice bran, soya meal. Juvenile phase 2-2.5 months Grow-out 6 months Final weight 1-1.5 kg Distribution in the wild Southeast Asia Farming Vietnam, Indonesia, Malaysia, Cambodia Farming system Ponds, floating cages, net-pen enclosure COMMERCIALISATION Utilisation Mostly frozen fillets Commercial weight 1-1.5 kg

Channel catfish (Ictalurus punctatus) Temperature 25-30°C Habitat Freshwater Diseases in farming Subject to a wide variety of diseases: Channel catfish virus disease

ontracaecum disease, enteric septicaemia, Columnaris, Aeromonas septicaemia, water mould, Proliferative gill disease, Copepod parasites, etc.

Maturation At 2-3 years Diet in the wild Carnivorous Diet in farming Artificial feed with approx. 32-35% protein content Juvenile phase 2-3 months Grow-out 12-15 months Final weight 1-1.5 kg Distribution in the wild South of Canada, USA, North of Mexico Russia, China, Brazil, Cuba Farming system Ponds, floating cages, net-pen enclosure COMMERCIALISATION Utilisation Frozen fillets Commercial weight 350-700 g

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Nile tilapia (Oreochromis niloticus) Temperature 20-30°C Habitat Freshwater, can grow in brackish water Diseases in farming Bacterial fin rot and Saprolegnia; parasites Trichodina, Chilodon, and

Ichthyophthiriasis. Maturation 3-4 months old Diet in the wild Herbivorous Diet in farming Feed with 28-36% protein Juvenile phase 5-8 weeks Grow-out 5-6 months (400+ g), 8-9 months (700 g) Distribution in the wild African and Middle East continental waters. Farming China, Taiwan,

Philippines, Indonesia, Malaysia, Vietnam, Mexico, USA, Egypt, etc. Farming systems Ponds, tanks, cages raceways COMMERCIALISATION Utilisation Fresh/frozen, whole/fillets Commercial weight 300-600 g More than 100 species of Tilapia. Three species represent the most commercial interest: Nile, Blue and Mozambique tilapia.

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Southern Blue Whiting (Micromesistius australis)

Temperature: 3-7°C Habitat: Saltwater Depth: 50-900 m Weight: Max. 850 g Length 30-90 cm Distribution Pacific Ocean

COMMERCIALISATION Utilisation Surimi

Hoki (Macruronus novaezelandiae)

Temperature: - °C Habitat: Saltwater Depth: 10-1000 m Weight Max. 7 kg Maturation: 3-7 years Length 60-120 cm, max. age 25 years Distribution South Pacific Ocean. New Zealand and Australia

COMMERCIALISATION Utilisation Fillet

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Redfish (Sebastes mentella)

Temperature: 2-15 °C Habitat: Saltwater Depth: 100-900 m Weight Max. 15 kg Maturation: 12-15 years Length 30-100 cm, age up to 60 years or more. Distribution North Atlantic, incl. the Barents Sea, Baltic Sea and North Sea

COMMERCIALISATION Utilisation Fresh/frozen, whole, fillets, salted

Deepwater Prawn (Pandalus borealis)

Temperature: 2-14 °C Habitat: Saltwater Depth: 20-1300 m Maturation: Hermaphrodite, first male, then female Length Max. 18 cm, age 8 years Distribution North Atlantic, incl. the Barents Sea, Skagerrak and North Sea

COMMERCIALISATION Utilisation Whole frozen, boiled

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Greenland halibut (Reinhardtius hippoglossoides)

Temperature: 2-4 °C Habitat: Saltwater Depth: 600-1200 m Weight Max. 20 kg Maturation: Male: 4-5 years, female: 9-10 years Length Max. 120 cm, age 30 years or more Distribution North Atlantic and North Pacific

COMMERCIALISATION Utilisation Salted, smoked

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