Grieg, Bremnes Seashore dissolve Ocean Quality JV
Grieg Seafood and Bremnes Seashore have dissolved their sales joint venture Ocean Quality, citing new business strategies in both companies.
Founded in 2010, Ocean Quality serves as the sales arm of the salmon farmed by the two companies in Norway, the Shetland Islands, and Canada. Grieg Seafood owned 60 percent of Ocean Quality and Bremnes Seashore AS owned 40 percent.
“Going forward, both Grieg Seafood and Bremnes Seashore will strengthen their efforts in the market, and will establish their own, fully integrated sales organizations,” the companies said in a joint press release.
The partnership will continue through the end of 2020 and will be completely dissolved by June 2021. Bremnes Seashore will take 100 percent ownership of the Norwegian organization Ocean Quality AS, with that company remaining a uniform sales organization with all its current Norwegian employees. Bremnes Seashore will also take over Ocean Quality Shanghai. Grieg Seafood will take 100 percent ownership of Ocean Quality North America, Ocean Quality UK, and Ocean Quality USA, and will retain all current employees of those operations.
“Grieg Seafood has an ambition to grow harvest volume to at least 150,000 tonnes by 2025, to become a cost leader in all regions where the company operates, and to reposition the company along the value chain from a pure supplier of salmon to become an innovative partner for selected customers,” Grieg Seafood said in a press release. “For Grieg Seafood to reach its ambitions, the company needs to strengthen integration between sales and farming operations, and from 2021 Grieg Seafood establish its own, fully integrated sales organization in Norway and internationally.”
Ocean Quality annually sold through Grieg’s and Bremnes’ joint production total of approximately 130,000 metric tons (MT) of salmon per year. That included 90,000 MT produced by both companies in Norway, as well as Grieg Seafood British Columbia’s 20,000 MT of production, and Grieg Seafood Hjaltland's 20,000 MT of production. Ocean Quality's main office is in Bergen, Norway, and it offers an additional three regional offices Bømlo, Norway; Lerwick, Shetland; Burnaby, British Columbia, Canada.
Of that total, Bergen, Norway-headquartered Grieg Seafood annually produces around 100,000 MT of salmon through farms in Finnmark and Rogaland in Norway; British Columbia and Newfoundland in Canada; and Shetland in the U.K.
The decision to move away from the joint venture comes as Grieg seeks to grow rapidly in the next five years, aiming to “achieve cost leadership in each region and to evolve from a pure salmon supplier to an innovation partner for selected customers,” Grieg President and CEO Andreas Kvame said.
“We have set ourselves ambitious goals. We will grow, be more effective, and take a more active role throughout the value chain,” Kvame said. “A crucial part of our downstream strategy is to further strengthen the cooperation between our production network and the sales organization. Fully integrating sales and marketing with current operations enables us to optimize upstream activities with local customer demand.”
Grieg Seafood has initiated the process of recruiting a chief commercial officer to build up and lead its new sales organization in Norway, and Grieg Seafood and Bremnes Seashore will continue existing partnerships in other areas like purchasing of feed and post smolt production, Kvame said.
“I would like to thank Bremnes Seashore for a very good collaboration over the last decade, and we look forward to continue our cooperation in the areas of feed procurement and post smolt production,” he said. “I would also thank all Ocean Quality employees for doing a great job over many years, making a solid foundation both companies will build on going forward.”
For Bremnes, Norway-based Bremnes Seashore, an increase in its own production, and the development of two strong brands internally, led to the decision to make the split, according to CEO Einar Eide.
“Since we established Ocean Quality 10 years ago, market dynamics have changed, and we have significantly increased production volumes. In addition, Bremnes Seashore has built up strong brands like SALMA and BÖMLO,” Eide said. “With fully integrated sales organizations in Salmon Brands and Ocean Quality, we can combine in-depth market and brand expertise with a well-developed customer network in the export markets. Now we will work towards new goals and I look forward to an exciting continuation together with talented colleagues in Ocean Quality. We have a good partnership with Grieg Seafood in other areas, such as feed purchase and large smolt production, and will continue this collaboration."
Eide and Kvame praised the work of the Ocean Quality staff through the COVID-18 pandemic.
“Both Grieg Seafood and Bremnes Seashore are proud of the achievements delivered by fantastic employees for 10 years. Not least are the two companies impressed by the efforts and results achieved during the COVID-19 pandemic,” they said. “All current employees are invited to continue in the new set-up.”
In a separate announcement on 20 May, Grieg Seafood said it had received certification of all of its farming sites in Nootka Sound, British Columbia, from the Aquaculture Stewardship Council. Grieg Seafood initiated an to attain ASC certification for all of its sites in 2019, with its remaining farms currently under review, with certification expected by 2021.
Separately, Grieg Seafood’s entire farming operation has already been awarded Best Aquaculture Practices certification, a program operated by the Global Aquaculture Alliance.
Photo courtesy of Grieg Seafood