Morten Vike, CEO i Grieg Seafood på Havbrukskonferansen på Radisson Blu Scandinavia i Oslo.

1. Grieg Seafood ASA
Canadian fish farming
in a downturn cycle
Havbrukskonferansen Morten Vike | CEO
2011 22 November 2011
griegseafood.no

2. Vision and values
”Grieg Seafood shall be a leading aquaculture company”
Our values:
• Open
• Respectful
• Ambitious
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3. Regions
Finnmark
Shetland Rogaland
British
Columbia
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4. Business overview
Grieg Seafood ASA
Grieg Seafood Grieg Seafood Grieg Seafood Grieg Seafood
Rogaland Finnmark BC Hjaltland
Licenses 19 + 1 farming 24 farming 21 farming 37 farming 101 + 1 farming
2011 guiding 16,000 tons gwt 17,000 tons gwt 13,600 tons gwt 16,700 tons gwt 63,300 tons gwt
Growth pot. +20% +39% +43% +27% +39%
Capacity ~19,000 tons ~28,000 tons ~20,000 tons ~23,000 tons ~90,000 tons gwe
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5. Regions – British Columbia
Western Canada Clio Channel
21 growout licences
Okisollo Channel
110 employees Esperanza Inlet Walcan, Quadra Island
Gold River
20 000 tonnes GWE (capacity) Nootka Sound
Jervis Inlet
13 500 tonnes GWE (2011) Grieg, Egmont
Sechelt
MNOK 554 revenue
Calkins and Burke
Vancouver
Broodstock Freshwater Seawater Harvest Value added Sales
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6. BC salmon farming - status
• Higher costs than global cost leading regions:
• Biological particularities (low dissolved oxygen, algal blooms, kudoa)
• Infrastructure
• High involvement 'permission to operate' climate (regulatory, public
relations etc.)
• US – the domestic market for Canadian salmon farmers:
• All other salmon farming regions have significant logistic disadvantages.
• Chile traditionally the main supplier to the US – regaining position after
the Chilean ISA crisis.
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7. The global salmon market –
Learnings from the last 2 years…
• The farmed atlantic salmon market is a true global market:
• Regional price differences on a 'net price back to farm' basis are not
sustainable over a longer period of time.
• Volumes can be shifted between markets relatively flexibly to exploit price
arbitration possibilities.
• Logistic costs a real price differentiator between markets and farming
regions.
• Demand in the US market hit the hardest by the Chilean ISA downturn and
subsequent surging prices:
• Lower retail activity level (filets)
• Less competitive pricing in certain horeca segments ('casual dining').
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8. Incremental logistic costs – US supply
+7-10 NOK/kg
+6-8 NOK/kg
+6-8 NOK/kg
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9. BC: Logistic costs offers price/cost
protection
• Current logistic costs suggests 6-8 NOK/kg price/cost protection for BC
salmon farmers compared to global cost leading farming regions.
• Average historical spot price difference between Norway and BC on
FCA-basis: 5-6 NOK
 Despite an inherent cost disadvantage, BC salmon farming should be
competitive with other global faming regions on the US market.
griegseafood.no

10. BC: Measures to reduce costs and
improve biological performance.
• Kudoa:
• A limited issue on GSF sites – only one site with some impact:
• Indirect entries have shown reduced occurrence of kudoa.
• Algae mitigation system ('bubble walls') protecting farms from toxic algae
• Reduced mortality losses.
• Re-oxygenation system to increase dissolved oxygen
• Reduced mortality losses and increased feeding and decrease lost feeding
days
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11. BC: Measures to reduce costs and
improve biological performance.
• Freshwater recirculation facility for smolt production:
• Improved smolt quality.
• Reduced smolt costs
• Smolt size – reduce seawater production time and reduce exposure to high-
risk algae season.
• Changed production and stocking plan to mitigate environmental risk:
• Harvest out highest risk area prior to 2nd summer season (algea risk).
• Site amalgamations to vacant underperforming farm sites (pending)
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12. Market differentiation
• Potential to exploit niche market positioning with a targeted
and differentiated market offer:
• Building on provenance
• Differentiate the extended product – more than just salmon.
• Target market segments with the lowest price sensitivity.
• Grieg Seafood BC recently launched Skuna Bay Craft Raised
Salmon:
• High-end restaurant segment
• Chef endorsement
• Craft raised
• Special product standards
• Certified environmental standards
• 1:1 fish in – fish out ratio
• Short travelled salmon
• Unique recyclable packaging griegseafood.no

13. Market differentiation
griegseafood.no

14. Summary
• A significant logistic cost advantage over other global farming
regions offers 6-8 NOK/kg price/cost protection for BC salmon
farmers.
• Cost reductions and biological performance improvements with
focus on certain particular cost and biological challenges.
• Potential of increased market differentiation as Chile is regaining
position as the major bulk supplier in the US market.
griegseafood.no

15. Thank you !
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