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Fishing 2018 and future outlook

13.05.2019

In Greenland, access to quotas is of paramount importance for our own fishing, as is the supply of raw materials from independent fishermen to our production units. Likewise in Canada, cooperation with fishermen is essential, as all production is based on purchases from independent fishermen and fishing fleets.

Greenland

In 2018, the fishing in Greenland was characterised by a positive development for prawn fishing, while cod still posed a challenge for Royal Greenland. In 2018, the Group's fishing totalled 61,500 tonnes.

Royal Greenland’s three prawn trawlers Akamalik, Qaqqatsiaq and Nataarnaq conducted a fantastic fishery in 2018 with focus on catch of large prawns. As a result, the values of the prawn catches increased considerably. Nataarnaq’s fishing at Melville Bay was particularly impressive, with the trawler team fishing 300 tonnes in the course of a single week. In 2018, the prawn quota for West Greenland was increased to 101,250 tonnes, and rises further in 2019 to 105,000 tonnes in accordance with biologists’ recommendations and the MSC management plan.

Following the replacement of the prawn trawler Qaqqatsiaq and the fishing trawler Sisimiut in 2019 with two newly built vessels, there will be a significant increase in both offshore fishing efficiency and capacity. The prawn trawler Nataarnaq is also scheduled for replacement in 2021. Follow the construction of Royal Greenland’s new trawlers here (LINK).

In 2018, the volumes landed at Royal Greenland’s factories in Greenland totalled 63,440 tonnes, 4% less than the previous year. The decrease is primarily due to a decline in the supply of cod.

In Maniitsoq, where Royal Greenland produces the popular and acclaimed Nutaaq® cod, the catch fell by 19% to 5,700 tonnes of live cod in 2018. To meet the significant market demand for Nutaaq®, the fishing grounds have been expanded. In addition, the availability of cod is expected to increase this season. Large quantities of small cod were observed in connection with the annual surveys conducted by the Greenland Institute of Natural Resources, which will be large enough for catching in 2019.

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Canada

Royal Greenland does not have its own fishery in Canada, and therefore all production is based on purchases of fish and shellfish from independent fishermen and fishing fleets.

In 2018, the prawn quota was cut by 20% in Newfoundland and Labrador, and by the same amount in the Gulf of St Lawrence/North. The crab quota was also reduced by 20% in Newfoundland in 2018, but in spite of this, the Royal Greenland subsidiary Quin-Sea Fisheries managed to expand its market share, and thus maintain a stable level of crab activities. The crab quota is expected to fall by a further 9% in Newfoundland, but on the other hand increase by 22% in the Gulf of St Lawrence/North in 2019, which gives an overall increase of 7% for Canada.

Outlook

The future outlook is basically a continuation of the positive trend which the company has been experiencing this decade. The North Atlantic species will continue to constitute a major proportion of the total business, and thereby boost earnings in accordance with ‘The North Atlantic Champion’ strategy.

Access to raw materials and the development in raw material prices are a significant operating risk for Royal Greenland. This risk is predominantly related to the live resources around Greenland and eastern Canada. These constitute 81% of Royal Greenland’s total raw material resources.

An essential element of the strategy is spreading the activities across several geographical resource areas. The reduction in the prawn quota in Canada is offset by an increasing quota in Greenland, and Royal Greenland’s global role in the prawn market is therefore unchanged and still very strong. 

For all core species, Royal Greenland has a broad risk diversification in terms of both raw materials and markets. Thus, products are sold to the retail, foodservice and industrial segments and sales primarily take place to Scandinavia, Europe, Asia, North America and other markets.

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