During the second half of 2019, Kontali mapped and analysed the social and economic effects of the May 2019 algae bloom in Nordland and Troms counties. The project was funded by the Norwegian seafood research fund (FHF) and the final report was delivered mid January 2020.
An estimated biomass of 14.500 tonnes (live weight) was lost during the algae bloom. The loss in biomass represented about 2% of the national biomass and about 6,5% of the biomass in the two counties. Smolt released during the spring of 2018 was hit the hardest, accounting for more than 56% of the lost biomass.
The aquaculture industry in Northern Norway is faced with substantial economic consequences of the algae bloom. The direct and indirect gross effects are estimated at between NOK 2,3 and 2,8 billion. The estimates include lost profits and ripple effects beyond the directly involved supply industry. The estimates also include an estimated loss in taxes of between NOK 210 and 300 million. Effects on employment will be most evident in primary processing plants, ongrowing sites, and within the supplier industries connected to on-site operations, freight and primary processing.
The authorities have introduced levitating measures in the form of compensated allowed biomass over a period of 5 years, which over time will offset a significant part of the economic consequences. Along with insurance coverage, this will help to limit and equalize the losses suffered by the various players. It also seems that affected companies, as far as possible, seek to avoid or limit layoffs.
Prior to the bloom, the algae monitoring was not optimal and when the mortality occurred, the capacity to handle the large volumes of dead fish in such a short time and in such a vast area was insufficient. Challenges in grinding and ensiling the dead biomass quickly enough, had consequences for the utilisation as residual raw material. The algae bloom has led to an intensified focus on surveillance and contingency plans from both businesses and government. After the incident, aquaculture businesses have intensified their focus on location access and flexibility.
Head of analysis
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