Lerøy Seafood, one of Norway’s largest seafood groups, intends to invest in its local facility despite the potential impact of the country’s planned aquaculture tax. This move comes as food and beverage industry trends reveal a shift towards domestic manufacturing and increased efficiency in the food and drink business.
In an effort to boost its Kjøllefjord plant in the Eastern Finnmark region, Lerøy Seafood plans to allocate NOK158m ($15m) towards expanding its production capacity for king crab and white fish. The facility plays a crucial role in sending high-quality seafood products to customers worldwide, aligning with the current food and drink consumer trends for sustainability and traceability.
Despite the threat of the proposed government aquaculture tax, this marks Lerøy Seafood’s second significant investment announcement in the past six months. The company previously invested NOK204m in its fillet factory in Båtsfjord, emphasizing its commitment to domestic production.
The investment in the Kjøllefjord facility aims to enhance its efficiency and capacity, creating opportunities for new investment areas within the seafood industry. By demolishing and rebuilding part of the existing building stock, Lerøy Seafood ensures a modernized production environment that meets the highest industry standards.
Børge Soleng, CEO of Lerøy Seafood, expressed confidence in the potential of seafood production in Finnmark, highlighting the positive impact on job creation and economic activity in the region’s coastal areas. This investment is a testament to the company’s trust in politicians’ promise to establish predictable framework conditions for the food and beverage industry.
In March, the Norwegian government faced industry pressure regarding the aquaculture tax, resulting in a revised proposal that reduced the tax burden for seafood companies. The updated plan introduced a 35% resource rent tax on seafood company profits, ensuring a manageable overall tax burden of 57%, including corporate tax.
Work on expanding the Kjøllefjord facility is scheduled to commence in 2024 and is expected to last for a year. Lerøy Seafood remains dedicated to processing more of Norway’s seafood catch domestically, contributing to sustainable growth and development in the country’s food and drink business.