Value optimisation in production
Optimising the value of the raw material is a key focus area in Royal Greenland’s fishing and production. Royal Greenland has 48 production units in Greenland, Canada, Germany and Denmark. In 2018, the production facilities were expanded with another factory in Canada, which will be converted for lobster production in the course of the current year.
An important aspect of Royal Greenland’s strategy is based on being ‘closest to the fish’, and thus on creating more opportunities for additional processing at the group’s 38 production units along Greenland’s west coast. The close proximity between fishing and production is good for the quality of the finished product while also creating jobs locally in the production units.
In 2018, Royal Greenland made significant investments in its factories in Greenland. In recent years, the focus of the investments in Greenland has been on expanding the production of Greenland halibut. Over a three-year period, more than DKK 100 million will be invested in production facilities for Greenland halibut. The focus is on expanding freezing facilities as well as further processing of the raw material in order to produce e.g. J-cuts and fillets.
The filleting capacity for cod is also being continuously expanded, and in 2019 a new cod factory will be opening in Sisimiut with a higher degree of processing and more capacity than previously. The factory will be run in cooperation with local fishermen, who will also supply the factory with raw materials.
In Canada, overcapacity at the factories due to declining quotas has presented challenges and resulted in new measures being introduced at Royal Greenland’s seven factories in Newfoundland and Quebec.
The smaller quotas for snow crab and prawns have resulted in intensified competition because of the surplus capacity at the factories. In spite of this, Royal Greenland has managed to strengthen its position with the inshore fishery, among other things by converting the prawn factory in Matane so that production can now be supplemented with crab.
With the addition of lobster in its product range, Royal Greenland has decided to invest significantly in lobster production in Canada. In 2018, the Group acquired a crab factory in New Harbour, which in 2019 will be converted into handling Quin-Sea Fisheries’ purchases of lobster from adjacent catch areas. With access to one of the northernmost populations of Canadian lobster (Homarus americanus), Royal Greenland can now offer a high-quality product that is both fished and processed locally in Newfoundland.
At the beginning of 2019, a project was launched to improve lobster pot fishing. Royal Greenland’s subsidiary Quin-Sea Fisheries is spearheading the project, and is in the process of establishing a working group that will adapt and improve the management of the lobster fishery with the final aim to have it certified as sustainable by the Marine Stewardship Council.
Royal Greenland operates two factories in Cuxhaven, one produces lumpfish roe in glass jars and the other handles pre-packaging of fish.
After Iceland lost its MSC certification for lumpfish roe in 2018, Greenland is now the sole supplier of MSC-certified roe. This has, combined with innovations within low-salt content and natural colour, contributed to the strong demand for the products, which has boosted sales and earnings in 2018. It is expected that these positive effects will continue in 2019.
The year also saw the start of filleting and sale of fresh cod fillets, which is expected to increase in 2019, where other species are scheduled to be included in the production as well. In connection with transferring the processing plant for prawns in Aalborg to Cuxhaven, an agreement was signed on a third lease next to the roe factory which will house a new production unit for repackaging prawns and producing of prawns in brine in top-modern surroundings. The upcoming facility will be operated under the same management as the other factories in Cuxhaven, and will form the framework for a strengthened strategy to provide the best service for local European markets.