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Trying to rebound from salmon glut, Norwegians opt for 'frozen solution'.

Trying to Rebound From Salmon Glut, Norwegians Opt for `Frozen Solution'

It's no secret that Norway's large salmon farming industry has had troubles in the last year or two. As masters of aquaculture, the Norwegians can lay blame for many of their problems on their own efficiencies.

Over the last 10 years, sales of fresh farmed salmon have increased at dramatic rates. Due to careful breeding and the use of the most modern techniques, production was able to keep pace with the demand as more fish farmers jumped on the bandwagon. Last year's record harvest of 118,844 tons from 791 farms represented a 32.5% jump over 1988. Unfortunately, world demand did not increase at the same rate. Prices fell and the gold rush days of salmon farming came to an abrupt halt.

With output forecast to hit 150,000 tons this year, the situation seemed to be going from bad to worse. When it was learned that the freezing of over-production was seen as a solution, Quick Frozen Foods International set out for Norway to get the facts.

Fiskeoppdretternes Salgslag (FOS) is the sales and marketing organization for the country's salmon producers. At headquarters in Trondheim, newly appointed marketing director Ole Gunnar Houmb talked up the quality aspect of Norwegian product. He stated that farmed salmon comes in three grades: superior, ordinary and production. Superior and ordinary differ only in appearance, while production quality fish have usually sustained some cosmetic defects in processing which must be cut away.

The quality of superior and ordinary grades has never been questioned. However, commercial damage has been suffered by production fish having found its way into markets where only better quality salmon is supposed to be merchandised. The problem has now been rectified and production grade, which represents a very small percentage of annual tonnage, will only be sold to licensed companies for limited usage. Trade show director Odd Berg was quick to point out that only ordinary and superior fish will be frozen.

The quality of Norwegian salmon is assured right from the start. The industry maintains a breeding station at Kyrksaeterora charged with developing high growth, disease-resistant strains of salmon. Since its inception in 1986, the facility has been able to increase the growth rate of each selection by 10%. Director Knut Gunnes pointed out that this has been accomplished without the use of medicine or gene manipulation techniques.

From the breeding station, the eggs are sold to smolt producers throughout the country who in turn sell the smolts to the farmers.

Down on the fish farm, standards set forth by FOS must be maintained to produce only the finest finished product. Mr. Houmb stated that everything from water quality to transportation has to fit into guidelines, and all functions are strictly monitored.

Recovery Steps Taken

FOS is taking steps to rectify the oversupply situation and put the industry back on a profitable footing. A comprehensive plan has been adopted to increase and stabilize prices. The organization's president, Odd Steinsbo, informed QFFI that the objective for 1990 is to sell as much fresh salmon as possible on traditional markets before buying and freezing surplus quantities. Norwegian exporters will purchase frozen salmon from FOS at terms which are better than those set as the minimum prices for fresh.

Initial estimates called for 110,000 tons to be sold fresh with the remaining 40,000 tons being frozen. However, at the time of this reporter's visit during the beginning of May, the forecast for frozen salmon had been dropped to 30,000 tons.

Mr. Steinsbo explained that this was due to two factors. First, because of an FOS recommendation to reduce feeding, the average fish size, and hence overall tonnage, was reduced. Second, despite higher prices, exports for the quarter have increased by 13.3%.

Still, 30,000 tons is a lot of salmon to sell in a sector of the market in which Norway has not previously been very active. A major concern to other salmon freezers is that FOS would sell the product at below market prices. Mr. Steinsbo was very emphatic when he said: "We will not sell frozen salmon cheaply."

Apparently, FOS doesn't have to either. NOK 5 (about 80 cents) has been collected for every kilo of fresh salmon produced for the freezing program. That, and a private bank loan, insure that a lot of product can be kept in cold storage for a long time.

Initial response indicates that storage times may be shorter than anticipated. To date, frozen salmon sales are up 13% over 1989, and traditionally frozen sales peak during the second half of the year.

However, FOS has made further assurances to the industry. If the product cannot be moved in ordinary markets, it will be sold for new purposes or to new markets. The Norwegian processing industry, where the use of frozen salmon will be restricted to the canned products and blocks of skinned and boned fish, is one example.

Quality-wise, FOS expects to maintain the same standards for frozen as the fresh variety is known for. In fact, Mr. Steinsbo claimed, "Our frozen salmon will be the highest quality the world has seen!"

Frozen is the Freshest

Explaining that the salmon is transported live from the farms to one of 40 freezing plants where it is headed, gutted and frozen within three hours, the president stated, "The most fresh fish you can get from Norway is frozen because it is only three hours old." The fish is glazed and brought down to below - 30 [degrees] C. within 15 hours.

Meticulous packaging insures that integrity can be maintained for up to two years, should the salmon need to be stored that long. Each fish is poly-bagged and placed in plastic-sealed boxes which are then palletized and completely surrounded with plastic wrap to provide further protection.

Predict 140,000T Output

For the future, the industry expects to exert more control over production to prevent oversupply problems. Predictions for 1991 and 1992 are for production to stabilize at respective tonnages of 140,000 and 130,000.

PHOTO : Odd Steinsbo, president of FOS, is hoping that Norwegian frozen salmon will become as popular as the fresh product the country has long been known for.
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Title Annotation:Norwegian salmon industry to store 30,000 tons of salmon in effort to stabilize prices
Publication:Quick Frozen Foods International
Date:Jul 1, 1990
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