Susanne Arfelt Rajamand has been the CEO of Nuuk, Greenland-based Royal Greenland since November 2022. It recently announced it posted a DKK 255 million (USD 36.8 million, EUR 34.2 million) pre-tax loss in 2023.
SeafoodSource: How would you describe Royal Greenland’s positioning right now?
Rajamand: We've been very successful in continuously growing our four species: prawns, snow crab, Greenlandic halibut, and cod. But, there's absolutely no doubt that similar to many other companies in the industry, the post-Covid time has been one of adjustment and other unprecedented experiences.
Inflation has significantly hit consumers, and we are also feeling that in our business. So, we are in a time where we were looking into our business and deciding what is the right structure to capture tomorrow. We are a 250-year-old company this year. That's a big number. There are very few companies that have that kind of heritage, and we're really looking into the future and asking how we [improve].
SeafoodSource: How is that review process taking shape?
Rajamand: I would say we're just beginning, but we're absolutely returning to a focus on our core species and our core footprints, which is obviously Greenland first and foremost and then Canada, looking at how can we get more out of where we are already deeply invested and how can we capture opportunities in a different way with more focus and more simplicity in the way that we operate in our infrastructure.
SeafoodSource: What is unique about Royal Greenland? What are the advantages and disadvantages of being based in Greenland?
Rajamand: Being Greenlandic is absolutely a massive advantage. Everybody wants to be part of the Arctic space, even China and Singapore declaring that they're part of the Arctic. Being up north in some of the cleanest waters in the world in a very remote destination offers a very different, unique selling point.
Our North Atlantic Champion Strategy, which was set out about 12 years ago, has definitely been advantageous. At that point in time, we were primarily a Scandinavian company with a footprint in certain European markets. What has happened over the last decade is that we have become truly a global company. We have a bigger presence in Asia. We have a good stronghold still in our core region, which we define as Europe, and then we managed to get a significant footprint of 15 percent in North America, which really is very important for us as a company because it just buffers for risk.
Clearly, in the geopolitical situation that we're in now, the business world is a lot harder to navigate. But, Greenland being a smaller country has definitely allowed some opportunities and some conversations that we may not be able to have otherwise.
SeafoodSource: You recently opened up a new processing facility in the remote town of Tasiilaq. How do you manage the logistics of operating in such a vast and sparsely populated place?
Rajamand: Operating in Greenland is unique in every way. Our new plant in Tasiilaq really speaks to the core of who we are. It’s a very remote community in East Greenland with 1,500 inhabitants, most of whom haven't had an opportunity to work for many years. So, when we were asked to put in our pitch for the quota that was being released [by Greenland’s government in exchange for an economic development program], it was very natural that that quota would fall to Royal Greenland because that is exactly the type of work that we do.
We create employment for these people living in very remote areas. With us being present with small- and medium-sized facilities in some of these remote settlements, it means that there's a place you can learn how to work and get integrated into the global economy. That’s why at our opening in Tasiilaq, despite it being a very far-off place, we had the prime minister, we had the finance minister, and we had the chairwoman of Royal Greenland there because it is important for us and for Greenland.
Operating in Greenland, everything is different. That's one of the things that we pride ourselves on and we really try to explain and share with our customers. When you buy goods from us, they have been through a totally different process. Our Greenlandic halibut is caught in the northern part of Greenland, and we’re not able to get in and catch it until the ice breaks.
This year, we have seen lower-than-expected catch rates because the ice has been too thick for us to catch them. There are so many things on a daily level that are more complicated. If there's a little thing that breaks in a factory, it's very unlikely that we have a backup because we cannot have backup for everything in our facility across all of our 38 facilities. Everything is more difficult, but that's also why we believe Royal Greenland is uniquely placed to navigate and fully optimize that opportunity because that has been the way that we've been operating for many years.
SeafoodSource: How tied to to the company's mission is national economic development and progressing Greenland’s economic agenda as a whole?
Rajamand: We are very tied in; we are 100 percent owned by the Greenlandic people, and some like to refer to us as a state-owned enterprise; however, I say we are owned by the 56,661 people in Greenland. We have a very tight collaboration with the government, including monthly meetings with our owner representative, which in this case is Múte Bourup Egede – the chairman of the Naalakkersuisut [Greenland’s Parliament] – to understand what's on the government’s agenda for us to share what's on ours.
We have a very well-managed, professional board which I report to, and we remain in close collaboration on the company’s commercial agenda. But, clearly because of our ownership, we're keen to hear what our key stakeholders expect from us and what they want from us. Some of it is described in the new owner policy that's currently being discussed or being reviewed, where there are some indications on what is expected from Air Greenland, Royal Greenland, Royal Arctic Line, and other state companies so each of us can find our piece of the puzzle and ensure that we contribute in the best possible way.
Additionally, we have 1,470 Greelandic people working for us, making us the largest company in Greenland, and that’s a big part of our social mission. But, that can sometimes be difficult to navigate, trying to figure out how to best live up to our social contract and how to successfully operate as a fully effective commercial entity. That's something that we need to get better at. It is very easy for that framework to slip over time, and it's something that we're working on right now, being clearer on how we function – but also to ensure that there's a better alignment and understanding with everybody in Greenland who has a keen interest in Royal Greenland’s success.
There's absolutely no doubt that if Royal Greenland sneezes, Greenland catches a cold. It has always been like that. So, we take our economic and financial contribution to Greenland very seriously, and that's also why we are very clear that we need to be as good or better than everybody else in the industry in all parts of our business system. That has to be the goal. Then, on that basis, we see how much profit that’s generating, and we look at how much the social mission costs us. That is the part that we need to be clearer in, articulating exactly that to ensure that the government of Greenland and all our 56,661 owners understand the choices we make. We're not in the business of politics.
SeafoodSource: Royal Greenland recently decided to close its seafood-processing facility in Matane, Quebec, Canada. Can you explain how this decision fits in with the company’s strategy and plans in Canada?
Rajamand: There's absolutely no doubt that we needed to refocus our operations in Canada, and closing down Matane was part of that. We went into Canada with some investments, and some of it worked out really well for us and created a core part of our business going forward; however, some of it did not. It’s part of the normal housekeeping of any business, though it's never easy when you have to let 22 employees go.
Canada remains a very important part of Royal Greenland’s footprint. We just kicked off the snow crab season in Newfoundland, and we were so ready – we had the workers waiting for weeks. Of course, the [pricing negotiations] were very heated; there's no doubt about that, and that's normal. We've navigated through that. We just want to be clear about what we want to do in Newfoundland, the investments we do, the optimization, opportunities, and also the great work that the team today is delivering. We’re very, very proud of our Newfoundland operation.
SeafoodSource: With Royal Greenland’s renewed focus on core species, how is that going to impact its Canadian operations?
Rajamand: North Atlantic species are core to us, and, therefore, Canada also remains very core. Our agreement to stop operations in Mantane was not related to our larger interest in Canada. It was purely about ensuring all our facilities are delivering the growth and profit that we we need to see in a fully commercial, efficient company.
SeafoodSource: How is the status of the stocks of your core species?
Rajamand: We saw there was a reduction in cold-water prawn, which was anticipated, so no surprises there. There's no doubt that we have unfortunately seen a decrease in the cold-water prawn, which is so essential to us. So, that's something that we are really looking at going forward. We have seen there's a lot of trial fishing now for cod, and we are expecting that there will be some opportunities there. We have hope and anticipation that there will still be some quota for pelagic when we get into the later part of the year. The rest is business as usual.
SeafoodSource: Are there any other changes on the way for the company?
Rajamand: We're looking to automation in the way that everybody else is doing as well. So, we are looking at how to streamline how to be smarter, how to be more efficient, and how to adapt to what we know are going to be some pretty shaky markets in the future. We were not greatly equipped for that in 2020, and we want to ensure that we are making those changes so we will be prepared from 2024 onward.
SeafoodSource: How are you looking at the next couple of years for the company and for the markets you serve?
Rajamand: We're having a bit of a back-to-basics, back-to-core approach to the world. History has shown if things are a bit volatile, we need to be very tight and need to ensure that we have enough of a buffer to navigate that volatility. That's what we are focusing on and setting ourselves up for. Everybody loves double-digit growth, but now we're just focusing on running a really tight ship so that we are ready for whatever the future holds. When we see the growth, we go after it, but it's a little harder to find these days. We need to be focused on doing what we do best, which is selling our core species.
SeafoodSource: Are you optimistic about the company?
Rajamand: Definitely. Our DNA is so linked to the trends of the future with high-quality products, sustainability, uniqueness, and storytelling. We're so fortunate that we probably have some of the easiest products in the world to sell because the quality is so good.
Of course, we have challenges getting the beautiful product out of the sea and to the market, but the product itself is so good. That keeps me very optimistic about the future of the company. We have a very well-known brand that’s highly esteemed in the category; that, combined with the quality of the products and our people, means we have a lot of good things going for us, which makes me very optimistic.
We need to be a lot more focused. We need to be somewhat slimmer. But, that's normal business continuity. You contract and expand depending on what happens in the market, and we're in a bit of a focusing mode right now.
SeafoodSource: What else is new at Royal Greenland?
Rajamand: Our Nutaaq cod is a unique cod product that represents a brilliant merger between the best of wild and the best of farming.
Working with fishermen on the west side of Greenland, they place net traps near rocky outcrops then transport the nets to large seawater pools close to the catching areas. The fish over 45 centimeters are taken by wellboat from the pools straight and literally swim into the factory. It goes from alive to frozen in two hours, or even less, and that gives you a meat that is absolutely unique to anywhere. It's great for the fishermen because it makes fishing so much easier, and it significantly increases the quality of the fish while sorting out smaller fish and returning them to the wild. So, that's a product to look out for, and we saw that at Seafood Expo North America in Boston, where all our customers know about it now and are all wanting it.
We’ve also been experimenting with seaweed over the past five years. We have learned through our pilot project that we can grow seaweed three times as fast, and the nutritional conditions of seaweed grown in Greenland are absolutely incredible. It’s still not scaled as I would like it, but we’re working on that now; that could potentially be a future core for our business, which is very exciting, and again will allow for a new income stream for Greenland.
SeafoodSource: Royal Greenland terminated its joint venture with Agama for processing fish for the Russian market in January 2024. Why?
Rajamand: There was a stand taken by Greenland that we could not be in Russia [after its invasion of Ukraine], and, therefore, we had to terminate. It was a business that we had looked forward to growing; we saw a lot of opportunities there. It was tough, but we had to walk the talk. After the Russian invasion, across the world, there was a clear message of not supporting Russia’s economy by buying Russian goods.
SeafoodSource: What are the opportunities and concerns facing Royal Greenland as a result of the changes in trading patterns that have occurred as a result of the Ukraine war?
Rajamand: With Russia, it was a very significant part of our strategy, but it was very clear what we needed to do. We were one of the first companies in the food sector to pull out, and we have done so 100 percent diligently. It was difficult to navigate through and impacted our profits for the past couple of years, but it was the right thing to do.
The thing is, when you make a stand like this, you also benefit from the reverse. We can say there’s no doubt any of our cod is Russian and that we’re not selling to Russia in any way; that gives us an opportunity to work in markets that don’t want Russian cod. It’s definitely an opportunity for the American markets [where Russian seafood imports have been banned], but it is difficult to understand the global impacts because we don’t know where the Russian cod will end up. It might be in other markets where we operate as well. It might be that it comes there at very competitive prices, which will be difficult for us to match. So, we really need to balance that out – whether we see an opportunity in the U.S. and where we might see some lower demand in other regions at the same time. It’s a tough situation to try to navigate through in this turbulent time.
To repeat, we believe in walking the talk, but we have not seen that across the seafood industry. We have seen a lot of Russian cod going into Europe. I would really like to have seen a little more of a stand taken on that in Europe. It’s about leadership. I've been very surprised that there has not been more willingness to deal with the real issues. It is not right. It is just not right. If you want to make those kinds of statements, you have to be willing to follow through, and we have not seen that in Europe at all. So, it's pleasing to see at least that the U.S. is making a stand.
