The Salmon Industry Analysis
Performance and impact of the salmon industry
The production growth and the export of farmed salmon comes from Norway, Chile, and Scotland, they account for about 80% of the total production of farmed salmon. As seen in Figure 1 (see below) the production of certain species has been increasing over time, while the production of others has been decreasing even stopping completely for some, king salmon. After the stock market crash in 2008, the production of fish in Chile dropped substantially, from 630.647 tons to 486.712 tons (Salmonchile, 2017). Overall however the production of salmon has increasing drastically since the 1990s, to the point where in 2004 Chile was matching Norway’s salmon production. The increased demand of salmon consumption
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The first foreign firm to enter the Chilean fishing industry was an American firm called Domsea Farms Chile, in 1974. However, it was not until the late 1980s that FDI started to have a significant impact on the Chilean industry. FDI inflows grew substantially between 1993 to 1996 and, again, between 1999 and 2000. The increase in mergers and acquisitions led to a decrease in the total number of firms in the industry but also led to the increase in the average firm size in the industry. One of the main issues that is caused by the increase in joint ventures between smaller Chilean firms and larger multinational companies, is the fact that these multinational companies would focus more on R&D. However, the R&D that they would focus on is in line with their own interests rather than in the interest of the national industry. Meaning that the industry might be weakened due to the lack of R&D at the national development level.
Another important impact of the Chilean fishing industry in the number of people employed in the industry. As mentioned before, the industry requires highly skilled labour to perform tasks that machines cannot. As well the Chilean fishing industry employs double the amount of labour than the Norwegian industry. 90% of the production is done in Region X, south of Santiago. Where the largest urban area is Puerto Montt. According to SalmonChile, in 2004 the fishing industry employed around 45,000 people, whether they were working directly with the industry or indirectly.
Salmon Clusters in the Chilean
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