In her report, ‘Chilean salmon industry - new regulations to slow growth, but future still remains bright’, Valeria Mutis, analyst, Rabobank, claims the growth in Chilean salmon output will stall between 2014 and 2016.
Speaking about the ISA (infectious salmon anemia) outbreak in 2008, she said regulation of the industry needs further improvement based on research to move to a more sustainable 'outbreak prevention' model as opposed to the more 'outbreak control' orientation of the system now in effect.
Sanitary deterioration
“The industry should be more preventive to maintain a good sanitary status which is good for the environment and also for business,” said Mutis.
“The latest developments show there is material sanitary deterioration at some neighborhoods. Besides the impact on production costs driven by this deterioration, this will in most cases cut the production potential of the affected sites in the following cycle.”
After the ISA crisis, the regulation stated when a farming site is ISA positive all fish must be slaughtered within a short time frame to avoid further dissemination.
Widespread outbreak
In 2007, the first ISA outbreaks appeared and immediately after, in 2008, there was a widespread outbreak of the virus that decimated the production of Atlantic salmon.
“Beyond the big losses and devastating effects, ISA triggered the complete transformation of the sector, a radical change of the salmon farming model in Chile,” she said.
“The industry organization under the new model is totally different than before the crisis; roughly speaking it shifted from an individual to a cooperative system (producers must work together under the concept of neighbourhoods or management areas) pursuant to strict biosecurity regulations and subject to the control and surveillance of a much more empowered authority.”
The report claims Chile has the potential to be one of the best places in the world to produce salmon long term and the America's and possibly Asia are where most growth will occur.
Profitable growth
“Hopefully, the past five or six years, which has seen the industry affected badly by outbreaks of the ISA virus, sea lice and other disease, will be key learning points which will set the industry on a path of more consistent, sustainable and profitable growth," added Mutis.
A new but more limited outbreak of the ISA virus has rattled the Chilean salmon industry in 2013 as it recovers from the 2008 crisis. Even though the outbreak was controlled, it raised doubts over the effectiveness of regulations put in place following the 2008 outbreak.
“Despite a severe crisis similar to 2008 being unlikely, the latest sanitary and production developments indicate that the industry still has challenges ahead,” she said.