Chile red tide expands; Sales losses mount

Published on
May 12, 2016

The red tide outbreak in Chile is expanding to a new region, and salmon processors’ losses continue to mount.

While Los Lagos in the south has been significantly harmed by the largest red tide in its history, now Los Ríos in northern Chile is also being affected.

“The red tide zone is going to grow, it is a changing phenomenon,” Raúl Sunico, Chile's deputy minister for fishing and aquaculture, told local radio station Cooperativa, according to The Guardian. “Highly toxic samples have been taken in the region of Los Ríos, which obliges us … to close areas of the region to resource extraction.”

Plus, Chiloé fishermen protests have also halted exports of salmon to the U.S. for the past week. They are protesting government reimbursement of their losses from red tide after initially offering 100,000 Chilean pesos (USD 147, EUR 129) to each family affected crisis. However, the government has since offered 300,000 pesos (USD 441, EUR 387).

Australis Seafoods said in a report filed with Superintendency of Securities and Insurance (SVS) that the port protests have caused it to lose USD 2 million (EUR 1.8 million) in processing that it cannot get to and a loss of fresh salmon sales of around USD 3 million (EUR 2.6 million).

In addition, around USD 1 million (EUR 878,383) worth of smolts are at risk of loss, because the farms are inaccessible due to fishermen blockades. Australis also noted "fixed expenses associated with production, which is stopped, for shipping services, selling and administrative expenses, and processing plant personnel" of around USD 300,000 (EUR 263,493).

Marine Harvest, AquaChile and other major Chilean salmon processors have reported signficiant earnings losses because of the red tide. Marine Harvest is restructuring its Chile operation after salmon losses and was forced to reduce its workforce by up to 500 employees.

And AquaChile CEO Torben Petersen resigned in late April after the company posted millions of dollars in losses.

Contributing Editor



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