After a decline in the early 2000s, Norway's wild fish industry has stabilized in recent years at just under 300 companies, according to the Nofima report.
Photo: Nofima.
New Norwegian research report reveals weak profitability for fishing sector
After two strong years, the Norwegian fishing industry experienced a sharp drop in profitability in 2023, according to a recent report, "The Ripple Effects of the Wild Fish Industry 2023" by Norwegian research organization Nofima.
Despite a total turnover of NOK 41 billion from 300 companies, profit before tax dropped to NOK 49 million, translating to an operating margin of just 0.1%.
The figures are concerning, the Nofima researchers say, as the fishing industry is an economic cornerstone for many Norwegian coastal communities.
In 2023, the Norwegian fishing industry employed 9,800 people and generated value of NOK 7.3 billion, in addition to what the researchers call "ripple effects" in other sectors including transport, packaging and equipment suppliers. Nofima has calculated that these account for a further 6,500 jobs and a value of NOK 6.7 billion.
“The fishing industry is important for many coastal communities. In some municipalities, over 60 percent of the private sector is employed in the fishing industry,” said Nofima researcher Audun Iversen, in a press release announcing the report's findings.
Weak performance across whitefish and pelagic sectors
In 2023, weak performance was seen across several fishing and processing sectors.
In the whitefish filleting industry, operating margins fell by 13.4%, driven by high raw material costs and fierce competition for cod, while in the pelagic sector, herring and mackerel processing had its weakest year in seven years. Declines were also noted in clipfish, stockfish, salted fish, and fresh packing of whitefish.
A notable exception was shrimp, the Nofima researchers point out, where increased access to raw materials, lower raw material costs, and favourable exchange rates helped boost margins and earnings significantly.
Challenges set to continue in 2025
Quota reductions in 2024 and further cuts in 2025 are expected to compound the challenges, particularly for whitefish processors, the researchers warn. Shorter seasons could make it harder to sustain year-round jobs, raising concerns for coastal economies in the longer term.
"The fleet has managed to increase margins over time, and 2023 was another good year for them. However, the processing industry has not achieved the same. Higher prices for products like cod have cushioned the fleet’s decline, but the processing sector has struggled to capture enough value from price increases in the market,” Iversen said.
"The wild fish industry has long faced low profitability, and last year was economically weak, with a pre-tax profit margin of just 0.1%. This is an industry crucial to many coastal communities, but its foundation is not robust," he added.
The full report can be accessed here.
