Mitsubishi Corporation will become the world’s second largest salmon farming company

Japan’s Mitsubishi Corporation will invest about 150 billion yen to acquire a salmon farming company in Norway. After the acquisition, its production will increase by more than 20%, and its ranking will rise from fourth to second in the world. Salmon is a protein source that requires less feed and has a low environmental impact, and global demand continues to expand. With few major production areas and limited supply increases, Mitsubishi Corporation will ensure the source of supply with an eye on Japan’s food security.

Grieg Seafood of Norway, which is about to transfer its shares, announced the news on July 17. Mitsubishi Corporation plans to acquire all shares of three farming business companies from Grieg Seafood through its wholly-owned subsidiary in Norway, salmon farming giant Cermaq, by October. Including inherited liabilities, the total acquisition amount is about 10 billion Norwegian kroner.

The acquisition targets are farming businesses in three areas in northern Norway and the east and west coasts of Canada. Mitsubishi Corporation’s annual salmon production will increase from about 200,000 tons to 250,000 tons, surpassing Norway’s SalMar and rising to the world’s second place. By improving production efficiency, the annual production will be increased to 280,000 tons by fiscal 2027. As for other Japanese companies, Mitsui & Co. has invested 24.5% in the subsidiary of Multiexport (Chile), the world’s eighth largest salmon farming company.

Cermaq, which Mitsubishi Corporation acquired in 2014, currently operates farms in Norway, Canada, and Chile. In the 10 years since the acquisition, production has increased by about 10% by obtaining production licenses in Norway and other regions in stages.

From the perspective of Cermaq’s sales targets, Europe accounts for 40%, North America accounts for 30%, Asia accounts for 20%, and South America accounts for about 10%. It is expected that this ratio will not change significantly in the future. Sales will also be strengthened in the Japanese and Southeast Asian markets. The net profit of the acquired business is expected to exceed 10 billion yen in fiscal 2027. After adding the profits from this acquisition, the net profit target for the entire aquaculture business, centered on subsidiary Cermaq, is to exceed 40 billion yen in fiscal 2027, which is about 2.9 times that of fiscal 2024.

With the growth of the global population and the economic development of emerging market countries, the demand for protein continues to expand. Compared with chicken and beef, salmon requires about 30% to 80% less feed for growth, and has attracted much attention as a protein source with low greenhouse gas emissions.

Research company Global Information predicts that the global salmon market will reach US$49.3 billion by 2029, 1.5 times that of 2024. Salmon can be eaten in a variety of ways, such as smoked salmon and grilled salmon. With the increase in health awareness and the rise of Japanese cuisine, the demand for raw salmon in developed countries such as Europe and the United States is also increasing. As a substitute for beef and pork, the demand for salmon is growing.

In the global salmon production, wild salmon accounts for about 20%, and farmed salmon accounts for about 80%. Farming is limited to countries with low seawater temperatures and small waves. Chile, which accounts for about 30% of the world’s farmed salmon production, currently does not issue new large-scale production licenses, and Norway, which accounts for about 50%, issues them about every two years. As supply cannot keep up with the growth in demand, it has become difficult to obtain rights.

Due to the expansion of demand, the price of farmed Atlantic salmon, the main species, has tripled in the past 20 years. Industry insiders said, “Salmon is a commodity with no substitute,” and even after the Trump administration implemented the (tariff) policy in the United States, the tariffs on exports from Norway and Chile to the United States increased, but the sales of salmon produced in these two countries in the US market are still good.

However, the farming business faces risks such as fluctuations in sales prices and diseases, and the fluctuations in production are large. After Mitsubishi Corporation acquired Cermaq, Cermaq suffered a final loss three times. The company also strives to stabilize production by introducing disease countermeasures such as laser equipment to remove parasites. In order to ensure and maintain a stable production system, similar countermeasures will be taken in the acquisition target companies.