Lerøy has decided to invest NOK 158 million (EUR 13.75 million / USD 14.77 million) in its factory in Kjøllefjord, in the province of Finnmark in the Nord-Norge region of Norway. The investment aims to increase the efficiency and capacity of the facility – which specializes in king crab, but also processes whitefish – and to provide space for new investment areas and seafood opportunities in the future. Works will begin in 2024 and last for one year.
Since Lerøy took over ownership, significant investments had already been made in upgrading the production equipment. However, the company's management, in close cooperation with the factory itself, has been working on plans to upgrade and expand the Kjøllefjord plant since 2019.
"This is a significant investment for the seafood producer Lerøy, for Kjøllefjord and for Eastern Finnmark," said Børge Soleng, CEO of Lerøy Norway Seafoods. "This investment means securing year-round jobs and operations at the plant, as well as good ripple effects in the local community." And continued, "With this, Lerøy gets a more robust and profitable business in Kjøllefjord, which provides opportuinites for further development."
The factory manager, Raimo Sørensen, was equally satisfied. "We have worked for many years to make this happen, and it is extra gratifying that we are reaching this goal with such a large investment and venture as this is," he said.
As mentioned, work will begin in 2024 and will last for one year with the aim of increasing not only the capacity but also the efficiency of the facility. "A significant part of the existing building stock will be demolished and rebuilt, and replaced with a completely new building and new production equipment. The total building area is 1, 534 square meters," Soleng explained.
In Kjøllefjord extensive work is carried out, the purchase of fish, fillet, salted fish, and, above all, crab is managed. "We invest heavily in crab here, and it is becoming increasingly important to us. We experience great demand for crab, and we supply a lot of crab from here," Sørensen claimed. "The crab helps secure our jobs here in Finnmark, and gives us stability in employment," he added.
However, although the Kjøllefjord bying station specializes in king crab, the factory also processes high-quality whitefish for filleting and salting. Products from this plant are shipped from here to customers all over the world. Now, Lerøy says that this expansion will also provide space for new areas of investment and opportunities in other seafood products in the future.
The investment in Kjøllefjord is in addition to the NOK 204 million (EUR 17.75 million / USD 19.07 million) which, as announced a year earlier, Lerøy invested last March in the Båtsfjord fillet factory. Through these two projects alone, the company has invested more than NOK 360 million (EUR 31.30 million / USD 33.64 million) in eastern Finnmark. Both are processing plants for whitefish or, as in this case, crab, but not salmon. Since announcing the dismissal of 399 employees last year as a result of the salmon tax, the company has not talked about job creation for this line of business.
"We have great faith in the production of seafood in Finnnark, and we look forward to further developing the potential here," stated Børge Soleng. The CEO of Lerøy Norway Seafoods added that the company has an integrated value chain that includes fishing quotas with extensive obligations, and that it is the trawling rights at sea that make it possible to make these investments on land.
Lerøy – which reported a successful Q2 2023, despite farming challenges – said it wants to strengthen its business in the region with more permanent year-round jobs in both the whitefish and aquaculture sectors and believes that the fishing industry can be one of several "dams" against negative development in the region. "Our aim is to process more of what is fished in Norway. This will also ensure activity and jobs along the coast," said Soleng. "We take our social mission seriously, and these are investments that will not only benefit the land industry, but which also ensure that we will be a large and serious customer of the coastal fleet in the future," he concluded.
Headquartered in Bergen, Norway, Lerøy Seafood Group (LSG) is a global seafood corporation. The Group has a vertically integrated value chain for red fish and white fish, as well as significant activities using third-party products, in which the Group's nearly 6,000 employees process between 350,000 and 400,000 tons of seafood products each year. In terms of sustainability, the Group has set itself several ambitious targets, including reducing greenhouse gas emissions by 46% by 2030.
