Santiago, Chile-based salmon farming and fishing company Camanchaca harvested 16,116 metric tons (MT) of Atlantic salmon during the third quarter, rising 16.5 percent from the same period one year prior and putting the company on course to meet its goal of 55,000 to 56,000 MT of Atlantic salmon and 4,500 MT of coho for the full year.
The Q3 harvest was nearly equal to the amount produced for the entire first half of the year and accumulated 33,443 MT through September, Camanchaca announced in an earnings release.
However, Q3 revenues and earnings before interest, tax, depreciation, and amortization (EBITDA) were down 6 percent and 6.5 percent to USD 76.0 million (EUR 69.0 million) and USD 19.8 million (EUR 17.9 million), respectively, due to a 5.3 percent year-on-year decrease in average prices. The company said it had 4,200 MT of inventory to be realized in the fourth quarter, when it expects prices to improve.
Net profit for the third quarter reached USD 22.0 million (EUR 20.0 million), surging 48.6 percent from the same period in 2018.
Live fish costs (ex-cage) decreased 11 percent year-on-year to USD 2.87 (EUR 2.61) per kilo during the third quarter, which Camanchaca attributed to “improved sanitary and environmental conditions and harvested sites that had normal stocking densities.”
However, it also said that it was noting an increase in sea lice levels, with decreasing efficiency in the industry’s current, most used pharmacological treatment (Azamethiphos, with industry average of 70 percent). As such, Camanchaca said it has needed to increase the number of treatments to control sea lice.
Through September of this year, it carried out 97 treatments at a total cost of USD 3.3 million (EUR 3.0 million), versus 39 treatments during the same nine months of 2018 at USD 1.4 million (EUR 1.3 million). It added that it will employ new measures, including pharmacological (hydrogen peroxide, alfaflux) and non-pharmacological (optilicer thermal treatment, FLS pressure, and flushing) to improve lice control.
During the first three quarters of the year, 44 percent of the company’s Atlantic salmon base was sold in the U.S., compared to 31 percent during the same period of 2018. Mexico was the second-highest destination at 13 percent (compared to 7 percent in 2018), followed by Japan at 8 percent (versus 4 percent), Russia at 7 percent (compared to 24 percent), and Brazil at 7 percent (versus 11 percent).
The company had previously reported “extraordinary low-scale” harvests for Q2 of 2019, blamed on algae blooms and low oxygen levels at its farms due to a supplier shortage.
Guidelines for Atlantic and Pacific salmon harvests for 2020 will remain similar to those levels for 2019, Camanchaca said. It aims to reach production of 75,000 to 80,000 MT by 2023, using sites in operation while improving farming and processing efficiencies, and it has committed to becoming carbon neutral by 2025, which will require the elimination or cancellation of nearly 20,000 MT of carbon dioxide the company emits annually. The company also confirmed a previous pledge to cut antibiotic use 50 percent by 2025 and achieve the Aquaculture Stewardship Council certification of the majority of its production by 2021.
During the social unrest and violence that has rocked Chile for over a month, which has damaged key parts of the economy including salmon production and exports, Camanchaca said that none of its employees or facilities had been affected, with a high attendance ratio at all facilities. There was normal operation of feed, oxygen, oil, and other supplies and annual harvest went mostly according to plan.
During the disturbances, five primary processing shifts and two secondary processing shifts were suspended, where 1,000 MT were not processed, which represented 1.8 percent of the annual total but will be transferred to 2020 production. Operations are currently back to normal, according to the release.
Sales have continued according to plan, and strikes at ports have had limited impact, with no limitations on air freight, Camanchaca said.
In reaction to the protests, the Chilean peso has lost about 12 percent of its value compared to the U.S. dollar, and 35 percent of expenses and costs are in the local currency, it added. Overall, however, with a strengthened dollar, foreign exchange conditions are actually favorable.
Photo courtesy of Camanchaca
