Canada Seafood Industry Report
Glitnir Seafood Team
October 2007Glitnir 2007 2
Contents
07. Glitnir Seafood Stockwatch [ 35 - 37 ]
02. Seafood Supply [ 10 - 19 ]
Foreword and Main Findings [ 3 - 5 ]
08. Glitnir – General Information [ 38 – 46 ]
01. Canada – Overview [ 6 - 9 ]
06. Conclusion – Opportunities and Challenges [ 33 - 34 ]
[ 28 - 32 ]
[ 23 - 27 ]
[ 20 - 22 ]
Page
05. Seafood Consumption
04. Seafood Sales and Trade
03. Seafood ProcessingGlitnir 2007 3
Foreword
Dear Reader,
It is our pleasure to present the latest issue of Glitnir's Seafood Industry Report. In this issue we focus on the Canada Seafood
Industry. We are now in our fourth year of publication and are grateful for the good feedback we have received from our industry
partners. We will issue 7 reports altogether this year, focusing on one country, region or species in each report.
In March 2006 Íslandsbanki (ISB) became Glitnir in a global group rebranding, unifying our national and international operations
under one brand.
Canada represents one of the top exporting nations for seafood and therefore one of the major players in the global seafood
industry. This report gives an analytical overview of the main driving forces within the Canadian seafood industry combined with
our evaluation of likely developments and future trends.
We trust you find this report of benefit. We at Glitnir are proud of our strong team of seafood industry experts and look forward to
working with you in our quest to make the seafood industry even more dynamic, efficient and profitable.
You can contact the seafood team via seafood@glitnir.is and www.glitnir.is/seafood.
Best regards,
Glitnir Seafood TeamGlitnir 2007
4
The Seafood Industry Value Chain
The purpose of Glitnir’s Canada Seafood Report is to assist our current and potential clients in understanding the
fundamentals of the Canadian seafood industry value chain.
A business may choose to devote its effort to one, several or all of the sectors in this chain. A sound investment
decision, however, must always be based on a clear understanding of each sector in which the value is created.
This report provides a general overview of the development and current status in aquatic catch and culture, seafood
processing, distribution and consumption in Canada.
Processing
Primary / Secondary
Distribution
Trading / Import & Export
Consumption
Trends / Species
Supply of Raw
Materials
Catch / CultureGlitnir 2007
5
Main Findings
• Seafisheries: Newfoundland, Nova Scotia, British Columbia and New Brunswick caught 91% of all landed volume in
Canada – making up 86% of the overall value in 2006
• Although Herring is the largest volume fishery, most of the value is coming from Lobster, Shrimp and Queen/Snow Crab
• Aquaculture: British Columbia produces about half of all volume and value in Canadian aquaculture followed by New
Brunswick and then Prince Edward Island – production in 2005 only increased by 5%, but high salmon prices increased the
overall value by 26%
• Harvest declines in traditional fisheries and increased demand for seafood will increase the need for aquaculture in the
world, and Canada is well positioned to benefit from growth in sustainable aquaculture
• Seafood consumption in Canada has been between 9 and 10 kg since peaking in 1999 at 10.03 kg per person
• Overall food prices in Canada are rising but seafood prices are not seeing any growth and have seen a slight decrease in
the last three years
• Canada exports an estimated 85 per cent, by value, of its fish and seafood production – US being the biggest market with
49% of the volume and 62% of the value of seafood exports
• The CAD/US exchange rate* has gone from 1.59 in late 2002 to 0.98 in late 2007 – price of seafood has only increased by
10% over the same period in the US
• Exporters need higher prices in the US to maintain their margins and capitalize on the growing US seafood market
Main Trends
• The weak USD is forcing seafood exporters to look into other markets – There was a 23% increase in seafood exports into
the European market in 2006
• Seafood companies are being forced to be more efficient and cost effective
• The number of vessels and processing plants continues to decrease
• Aquaculture production is expected to continue growing in Canada as long as prices for farmed seafood are strong
*All $ amounts in this report are in Canadian DollarsCanada – Overview
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. ConsumptionGlitnir 2007
7
The Canadian Economy
• Area: 9,984,670 sq km
• Population: 33,390,141 (July 2007 est.)
• GDP: Annual real GDP growth for 2006 is estimated to have
been 2.7%.
• GDP (PPP): $1.178 trillion (2006 est.)
• GDP per capita (PPP): $35,600 (2006 est.)
• GDP composition by sector: agriculture: 2.3%,
industry: 29.2%, services: 68.5% (2006 est.)
• Inflation rate: 2% (2006 est.)
• Unemployment: 6.4% (2006 est.)
• Foreign trade: export $405 billion f.o.b. (2006 est.), import
$353.2 billion f.o.b. (2006 est.)*
• Exports - partners: US 84.2%, Japan 2.1%, UK 1.8% (2005)
• Imports - partners: US 56.7%, China 7.8%, Mexico 3.8%
(2005)
Source: CIA World Factbook, Foreign Affairs and International Trade Canada * f.o.b. = free on board
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. ConsumptionGlitnir 2007
8
Canadian Seafood
• Total catch of 1 million MT in 2006* – total value $1.8 billion
• Canadian fisheries are still recovering from over fishing that was ongoing until the mid 90´s
• Landed Volume was slowly increasing from year to year, but has seen a slight decrease in the last 3 years
• Value of seafood has risen, especially in the last 10 years
• Value of capture seafood is expected to continue rising
• Growing demand for seafood in the world is being satisfied through increased aquaculture
0
500
1.000
1.500
2.000
2.500
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
20 Year Trend in Volume 20 Year Trend in Value
Source: Fisheries and Oceans Canada
0
200
400
600
800
1.000
1.200
1.400
1.600
1.800
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006 * 2006 numbers are preliminary
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. Consumption
(000 MT) ($millions)Glitnir 2007
9
Aquaculture Production
• Aquaculture is one of the fastest growing food production activities in the world
• Aquaculture in Canada has quadrupled in the last 15 years, both in value and volume
• Canada has an opportunity to take advantage of the increased demand for farmed seafood by continuing
the steady increase in production that has been ongoing for the last 15 years
Source: Fisheries and Oceans Canada
Volume and Value 1990 - 2005
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. Consumption
0
20.000
40.000
60.000
80.000
100.000
120.000
140.000
160.000
180.000
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
MT
0
100
200
300
400
500
600
700
800
$millions
volume valueCanadian Seafood Supply
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. ConsumptionGlitnir 2007 11
East Coast Seafood Supply in 2006*
Quebec
58
PEI
38
New Brunsw ick
110
Nova Scotia
253
Nfld.
374
• Total catches on the east coast were 834,000 MT in 2006 – total value was $1.5 billion
• Newfoundland leads in volume with 45% of total east coast landings
• Volume is relatively stable compared with recent years
• Nova Scotia has most of the total landed value – 43%
• Value has decreased due to a weaker US dollar
Source: Fisheries and Oceans Canada
Total Landings 2006
(000 MT)
Value of Landings 2006
($millions)
Nfld.
468
PEI
137
Quebec
106
New Brunsw ick
151
Nova Scotia
639
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. Consumption
* Preliminary numbersGlitnir 2007 12
East Coast Landings by Species
0
200
400
600
800
1.000
1.200
Groundfish Pelagic & other
finfish
Shellfish Other
Volume Value
Other
197
Lobster
52
Capelin
42
Mackerel
54 Scallop
63
Crab, Queen
89
Herring
160
Shrimp
177
• Shellfish is dominating on the east coast in volume and value
• Landed value of Queen Crab is $150 million less than in 2005 due to a reduced TAC
• Value of Scallop has increased year on year
• Value of Pelagic and Groundfish is similar in 2005 and 2006
Source: Fisheries and Oceans Canada
Clams/quahaug
33
Cod
37
Haddock
26
Herring
34
Turbot
35
Other major
species
Scallop
86
Lobster
618
Shrimp
231
Crab, Queen
209
Volume and Value by Species 2006
Value by Species 2006
($millions)
Volume by Species 2006
(000 MT)
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. Consumption
000 MT & $millionsGlitnir 2007 13
Nova Scotia with 36% of total Value
• Newfoundland catches the most of all the provinces – 374,000 MT in 2006
• Shrimp accounts for a third of all the volume in Newfoundland
• Pacific Hake accounts for half of the overall volume in British Columbia
• Nova Scotia has the most valuable seafood with Lobster being 56% of that value
• NB and PEI are also heavily reliant on Lobster while BC gets most of its value from wild salmon and Shrimp
Source: Fisheries and Oceans Canada
Landings by Province 2006 Value by Province 2006
0
50
100
150
200
250
300
350
400
NFLD NS BC NB QC PEI
0
100
200
300
400
500
600
700
NFLD NS BC NB QC PEI
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. Consumption
(000 MT) ($millions)Glitnir 2007 14
West Coast Seafood Supply in 2006*
 96
 24 22
 17
 3 2 4 4
 25
0
25
50
75
100
Hake
Salmon
Herring
Redfish
spp. Shrimp
Clams/quahaug
Crab
Tuna
Other
• Total catch was 198,000 MT in 2006 – total value was $255 million
• 2/3 of the volume came from Groundfish in 2006
• 96,198 tonnes of Pacific Hake were caught in 2006 – half of the total volume but only 11% of the total value
• Shellfish only accounts for 6% of the volume but 36% of the value
• Preliminary numbers indicate a considerable decrease in volume and value
Salmon
59
Shrimp
39
Clam/quahaug
27
Tuna
11
Hake
27
Crab
21
Other
28
Redfish
22
Herring
21
Volume of Major Species 2006 Value by Species 2006
($millions)
Source: Fisheries and Oceans Canada * 2006 numbers are preliminary
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. Consumption
000 MTGlitnir 2007 15
Inland Province Fisheries
• Ontario and Manitoba combined seafood exports totalled 133 million CAD in 2005
• Alberta and Saskatchewan exported Seafood for 10 million CAD in 2005
Freshwater Fisheries (2005):
Ontario:
Volume of 13.400 tons,
Value of CAD 35.1 million
Main Species (by value): Perch, Whitefish, Smelt, White Bass
Manitoba:
Volume of 11.400 tons,
Value of CAD 22.0 million
Main Species (by value): Yellow Pickerel, Whitefish, Sauger
Aquaculture (2005):
Ontario:
Production volume of 4,000 tons
Production value of CAD 15.5 million
Main producer of Trout in Canada
Manitoba:
Production value of CAD 43,000
Production volume of 11 tons, Production in Lake Winnipeg and adjoining lakes (Freshwater)
Source: Fisheries and Oceans Canada
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. Consumption
Inland Province Exports 2005
($millions)
Ontario
83
Manitoba
50
Alberta
Saskatchew an 8
2Glitnir 2007 16
Salmon Dominates Canadian Aquaculture
Oysters
16
Clams
8
Mussels
34
Other
99
Trout
21
Salmon
546
Value by Species 2005
($millions)
Volume by Species 2005
(000 MT)
Trout
5
Other
16 Clams
2
Oysters
13
Mussels
23
Salmon
98
• Salmon is the most prevalent species grown, though shellfish farming has shown steady growth
• Salmon production in 2005 was 98,000 MT with a total value of $546 million
• Trout Production was just under 5,000 MT in 2005 – no change in volume from 2004
• Shellfish production in 2005 was 38,000 MT and has seen 18% growth since 2000
Source: Fisheries and Oceans Canada
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. ConsumptionGlitnir 2007 17
BC Leads in Volume and Value
• BC produces about half of all volume and value in Canadian aquaculture
• Aquaculture in BC is still increasing with additional 2,000 MT produced in 2005
• New Brunswick produces most of the aquaculture on the east coast – 38,000 MT in 2005
• Overall aquaculture production in Canada increased by 5% from 2004 – 2005
• High Salmon prices drove the overall value up 36% in the same period
Aquaculture Volume in 2004 - 2005
6
21
5
37
2
4
71
146
8
19
9
38
2
4
73
153
0 50 100 150 200
Nfld
PEI
NS
NB
Que
Ont
BC
CANADA
000 MT
2004 2005
Aquaculture Value in 2004 - 2005
22
33
19
181
11
16
228
527
34
29
40
231
13
16
337
715
0 100 200 300 400 500 600 700 800
Nfld
PEI
NS
NB
Que
Ont
BC
CANADA
$millions
2004 2005
Source: Fisheries and Oceans Canada
Volume in 2004 & 2005 Value in 2004 & 2005
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. ConsumptionGlitnir 2007 18
Aquaculture Value
Salaries and wages 101,100 108,600 102,700 105,200 100,600
Gross value added (factor cost) 255,200 220,005 209,709 203,345 241,800 2
Product inputs 496,000 536,745 518,741 531,920 542,745
Change in inventory value for goods 34,400 2,400 -8,700 57,160 31,990
Other revenue 26,770 20,250 16,255 15,775 13,715 1
Sales of aquaculture products and services 690,030 734,100 720,895 662,330 738,840
Gross outputs 751,200 756,750 728,450 735,265 784,545
Aquaculture in Canada ($000) 2001 2002 2003 2004 2005
1. Other revenue is a collective category which includes some confidential data points.
2. Gross value added at factor cost is residually derived by subtracting product inputs or purchases from other businesses, fro
m
the gross output of the sector.
Source: Statistics Canada, CANSIM, table (for fee) 003-0003 and Catalogue no. 23-222-XIE (free).
Last modified: 2006-10-18.
Source: Statistics Canada
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. ConsumptionGlitnir 2007 19
Salmon Prices Rebound in 2005
0
0,5
1,0
1,5
2,0
2,5
3,0
3,5
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Salmon Trout Clams Mussels Oysters
• Salmon prices bounced back and
were $2.51 on average in 2005
• Trout prices have stayed between
$2 and $2.50 for the last 15 years
• Mussel and Oyster prices have
remained very stable in the same
time period
• Clam prices were on the rise in the
90´s but have decreased slightly
since peaking at $2.99 in 2000
Source: Fisheries and Oceans Canada
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. Consumption
(CAD/lb)Canadian Seafood Processing
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. ConsumptionGlitnir 2007 21
Seafood Processing Industry in Canada
• Wholesale value of production averaging about $5 billion annually
• Fish, aquaculture and seafood processing employs over 48,000 people in full and part time positions in approximately
1,000 registered processing operations
• Seafood plants are mainly located in remote rural areas across Canada's shorelines and lakes
• The seafood processing industry is vital to the economic success of several provinces and also crucial for many rural
communities
• The industry was able to steadily increase export earnings despite the collapse of groundfish stocks on the Atlantic coast
and the sharp declines in BC salmon production
• This was done by shifting production to higher value shellfish species, increasing its output of value added products,
increasing aquaculture production and by importing and processing raw product from other producer countries
• The industry has been slow in adopting new technology to further enhance the value of production
Source: NSSC
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. ConsumptionGlitnir 2007 22
Exporting less processed fish
0 10.000 20.000 30.000 40.000 50.000
Fillets, Fresh
Fillets, Frozen
F ish, smo ked
Fish, salt ed/ dried
Fish, pickled / cured
Fish, canned
Fish livers and roes
Fish M eal
F ish oil
Ot her Fishery Product s
MT
2006 2005
• Most Canadian fish is exported
whole/dressed and either fresh or
frozen
• Considerable decrease in fillet
exporting from 2005 to 2006
• Smoked, salted, pickled and canned
fish exports are relatively stable
• Fish meal and fish oil exports are on
the decline
• Many seafood processors are
having difficulties coping with the
weak US dollar since most of their
processed products go to the US
market
Source: Fisheries and Oceans Canada
Processed Products – Exports 2005 and 2006
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. ConsumptionCanadian Seafood Exports / Imports
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. ConsumptionGlitnir 2007 24
Canada exports big majority of its seafood
0
500
1.000
1.500
2.000
2.500
USA
Europe
Central and
South
America
China
and
Japan
Other Countries
Volume
Value
NEW BRUNSWICK
795
NEWFOUNDLAND
798
BRITISH COLUMBIA
987
NOVA SCOTIA
974
OTHER PROVINCES
PEI 140
194
QUEBEC
203
• Canada exports an estimated 85%, by value, of its fish and seafood production
• Most of the seafood exports are heading into the US – 49% of the volume and 62% of the value in 2006
• Japan and China combine for 18% of the volume and 15% of the value
• Exports to the European market grew 23% from 2005 – 2006 and 16% of the total export value came from
exports into Europe in 2006
• British Columbia and Nova Scotia create almost half of all seafood export value in Canada with 48%
Source: Fisheries and Oceans Canada
Canadian Export Markets in 2006 Export value by Province in 2006 ($millions)
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. Consumption
000 MT & $millionsGlitnir 2007 25
Lobster and Salmon exports most valuable
0
500
1.000
1.500
2.000
2.500
3.000
USA
China
Japan
Denmark
Russia
United Kingdom
Volume
Value
LOBSTER
1,002
OTHER
SPECIES
1,696
SHRIMP,
PRAWN
456
CRAB,
SNOW/QUEEN
426
ATLANTIC
SALMON
512
• Shellfish is the most valuable seafood export
• Salmon is now 13% of the value but is growing every year
• Shrimp has grown in volume but lost exporting value do to a weakening $US
• Snow/Queen Crab has increased in exporting volume but at the same time has lost some value because most of
the Crab is going into the US market
• Exporting volumes are on the rise but the weak US dollar is cancelling out the increased value that otherwise
would be realized
Source: Fisheries and Oceans Canada
Seafood Exports by Country in 2006 Export Value by Species 2006 ($millions)
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. Consumption
000 MT & $millionsGlitnir 2007 26
Weak USD impacts value of exports
0,6
0,8
1,0
1,2
1,4
1,6
1,8
2,0
January
1996
July
1997
January
1999
July
2000
January
2002
July
2003
January
2005
June
2006
Oct 10,
2007
1 USD 1 EUR 100 JPY
Source: Bank of Canada
• 49% of Canada's export
volume goes to the US,
which creates 62% of
the total export value
• The recent growth in
exports to Europe is
likely to continue as a
result of the weak US
dollar
• The CAD is more
valuable than the USD
today
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. ConsumptionGlitnir 2007 27
BC and Ontario relying on imports
0
100.000
200.000
300.000
400.000
500.000
600.000
700.000
BC
ONTARIO
NB
QUEBEC
NS
OTHER
Volume
Value
UNITED
STATES
797
CHINA
351
OTHER
509
THAILAND
268
CHILE
98
VIET NAM
91
• Canada imported a total of 482,000 MT of seafood in 2006, with a value of $2.1 billion
• Shellfish was 43% of all imports in 2006 - Shrimp is the most imported species with 19% of
the total value of imports
• BC and Ontario imported 62% of the volume in 2006
• Most of the imports come from the US, although there is a slight decrease from 2005 - 2006
• Imports from China and Thailand increased from 2005 – 2006
Source: USDA; Fisheries and Oceans Canada
Imports by Province in 2006
Value by Country in 2006
($millions)
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. Consumption
000 MT & $millions
1. Lobster 25%
2. Frozen Fish 11%
3. Fish Fillets 11%
4. Scallops & Molluscs 10%
5. Canned Salmon 8%
6. Salmon 6%
Top imports from the US in 2006Canadian Seafood Consumption
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. ConsumptionGlitnir 2007 29
Steady seafood consumption
3,97 4,49 4,30 4,03 4,82 4,51 4,39 4,01 4,43 3,94 4,04 4,09
2,20
1,97 2,26 2,38
2,50
2,19 2,67 2,96 2,81 2,74 2,90 2,87
1,49
1,66 1,86 2,11
2,29
2,35 2,12 2,17 2,03 1,93 1,90 1,89 0,25 0,30
0,36 0,32
0,42
0,46 0,47 0,43 0,53
0,51
0,48 0,51
0
1
2
3
4
5
6
7
8
9
10
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
Kg. per person / year
Seafish, Fresh & Frozen Seafish, Processed Shellfish, Total Freshwater
7,91 8,42 8.78 8.84 10.03 9.51 9.65 9.57 9.80 9.12 9.32 9.36
Å Total
Source: USDA; Fisheries and Oceans Canada; Statistics Canada
• Seafood consumption in 2006 was 9.36 kg per capita1
• Since peaking in 1999 at 10.03 kg, seafood consumption in Canada has been relatively stable
• Processed seafish consumption has seen steady growth in the last decade
• Freshwater fish consumption has doubled since 1995
Seafood Consumption 1995 – 2006
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. Consumption
1 edible weightGlitnir 2007 30
Poultry consumption growing
8,42 8,84 9,51 9,57 9,80 9,12 9,32 9,36
30,70 32,50 35,00 36,71 35,81 37,11 37,29 37,72
60,70 62,40 63,10 61,60 60,56 61,06 57,29 58,48
0
20
40
60
80
100
1996 1998 2000 2002 2003 2004 2005 2006
Kg. per person / year
Fish Poultry Meat
Source: Statistics Canada Fish = edible weight, Poultry = eviscerated weight, Red Meat = carcass weight
• Protein consumption has gone up by 5.8 kg per person during the last 10 years
• Meat consumption has been decreasing since 2000
• Poultry consumption has seen steady growth since 1996, a total increase of 23%
• Fish consumption has increased by 11% since 1996
99.8 103.7 107.6 107.9 106.2 107.3 103.9 105.6
Å Total
Canada Animal Protein Consumption 1996 - 2005
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. ConsumptionGlitnir 2007 31
Seafood prices not increasing
90
95
100
105
110
115
2002 2003 2004 2005 2006
All foods Food purchased from restaurants Food purchased from stores
90
95
100
105
110
115
2002 2003 2004 2005 2006
Meats Fresh/frozen red meat Poultry Processed meat Seafood
Source: Statistics Canada
• Price of food is rising in Canada – both in stores and restaurants
• Poultry is leading with a 13.4% increase in price over the last 4 years
• Meat has risen 8% over the same period
• Seafood prices are staying relatively flat but have seen a slight decrease since 2002
Consumer Price Index 2002 - 2006
Food Prices in Canada Food Prices by Category
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. ConsumptionGlitnir 2007 32
Canadian Consumption Trends
• Continuing competition in the grocery retail chains
– A new line of high end grocery stores offering better quality products being introduced
– The retail marketplace has been transformed with a move to larger "big box" stores and the decline of the traditional
department store, a number of key retail sectors such as supermarkets and drugstores are dominated by a few large
players
• Different food channels
– Increase in non-traditional food sales, such as e.g. pharmacy retailers
– Increased food sales through mass merchandise warehouse's such as Costco and Sam's Club of Wal-Mart
• Increased consumer awareness
– Consumers can use the Internet to equip themselves with detailed product and price comparison information well before
they make a consumer purchase, an option that was not available prior to the 1990´s
• Less time
– Consumers rely increasingly on ready-to-eat products
– People are willing to pay a premium for the convenience factor of not having to spend time on food preparation
• Seafood consumption set to gain momentum
– Seafood consumption in Canada is likely to increase as obesity and health problems become more and more prevalent
Source: OCA
01. Canada overview
02. Supply
03. Processing
04. Distribution
05. ConsumptionGlitnir 2007 33
Conclusion – Opportunities & Challenges
Opportunities
• Canadian seafood exporters need to continue diversifying into other markets:
– The CAD/USD exchange rate has been driving down the value of Canadian seafood exports and it is going to take
some time until we start seeing the prices rise to recapture the lost value
– Exporters need to continue diversifying into other markets to force the US to compete for Canadian seafood products
• Strong and growing demand for seafood in the United States, the largest market:
– US seafood consumption increasing by 0.32 kgs in 2006, totalling 7.5 kgs per person
– Americans consumed a total of 2.2 billion kgs of seafood in 2006
– The demand is growing but the weak USD is making exporting into the US difficult for Canadian seafood producers
• Growing health concerns – Increased demand for healthy food:
– An opportunity exists to further promote seafood as a healthy choice – obesity and health problems are still increasing
– Canadian seafood producers have to spend time and money on promoting Canadian seafood products as an healthy
alternative protein source in the food sector
• Further consolidation is needed:
– There is an opportunity to consolidate on the harvesting side to more effectively land the TAC, but in doing so the
Canadian government needs to consider all stakeholders involved in the fishery
– The fishery management system in Canada needs to be modernized to reflect the economics of today's fisheries
Challenges
• Market pressure, foreign competition, sustainability, and exchange rates are inflicting stress on the industry
• The weak US dollar has already had a major impact on the Canadian seafood industry and companies need to make
adjustments to deal with lost revenues
• Price fluctuations, especially in shellfish and salmon, can quickly affect the industry
• High oil prices are hurting the industry and are likely to continue to do soGlitnir 2007 34Glitnir 2007 35
Glitnir Seafood Stockwatch – Europe
113.4
13.4%
-2.1%
Europe Index
Index, %change YTD
Index, %change from August 20
Icelandic Group Hf Iceland 249 5.8 -20.3% 11.5 14.5
Nirefs Aquaculture SA Greece 273 4.0 0.5% 11.7 18.1
Aker Seafoods ASA Norway 361 44.0 42.9% 10.4 24.5
Biomar Holding A/S Denmark 453 227.5 -8.3% 11.7 10.6
Alfesca Iceland 546 6.3 27.1% 9.0 17.0
Pescanova Sa Spain 596 34.0 25.6% 10.2 19.6
Leroy Seafood Group ASA Norway 1,122 124.0 9.7% 8.6 11.0
Cermaq Asa Norway 1,538 98.5 7.1% 8.7 13.4
Austevoll Seafood ASA Norway 1,540 49.5 15.1% 8.4 13.5
Marine Harvest Norway 3,957 6.7 15.2% 12.0 16.0
12m EV/EBITDA 12M P/E Change (%) in share price YTD Current share price M.Cap m.USD Company Country
Europe
Index: January 1, 2007 = 100
Sources: Bloomberg, Individual Stock Exchanges, Company Annual and Quarterly Reports Revenues, Glitnir. Data as of September 25, 2007, "nmf" = not meaningful, "n/a" = not
available.
Disclaimer: The companies on the list have been selected by Glitnir. Glitnir banki hf. hereby disclaims liability and does not accept any responsibility for such information or is giving
any advice in relation to investments in those companies.
in cooperation withGlitnir 2007 36
Glitnir Seafood Stockwatch – The Americas
128.9
28.9%
5.1%
Europe Index
Index, %change YTD
Index, %change from August 20
High Liner Foods Inc Canada 99 10.1 15.4% 16.3 25.3
Omega Protein Corp US 152 9.0 16.3% 8.9 nmf
Fishery Products Ltd (Fpi) Canada 220 17.3 127.3% 9.0 27.4
Clearwater Seafoods Inc Fund Canada 231 4.6 -6.6% n/a nmf
Invetec Pesquera Mar De Chil Chile 247 555.0 17.7% n/a 16.4
Pesquera Iquique-Guanaye Sa Chile 255 37.0 47.4% n/a 9.2
Pesquera Itata Sa Chile 351 300.0 39.5% 7.0 14.9
Sociedad Pesquera Coloso Sa Chile 393 1050.0 16.7% 13.5 13.4
Connors Brothers Income Fund Canada 402 8.2 -21.5% 10.9 8.6
Copeinca ASA Peru 632 64.0 43.6% 7.8 14.9
12m EV/EBITDA 12M P/E Change (%) in share price YTD Current share price M.Cap m.USD Company Country
The Americas
Index: January 1, 2007 = 100
Sources: Bloomberg, Individual Stock Exchanges, Company Annual and Quarterly Reports Revenues, Glitnir. Data as of September 25, 2007, "nmf" = not meaningful, "n/a" = not
available.
Disclaimer: The companies on the list have been selected by Glitnir. Glitnir banki hf. hereby disclaims liability and does not accept any responsibility for such information or is giving
any advice in relation to investments in those companies.
in cooperation withGlitnir 2007 37
Glitnir Seafood Stockwatch – Asia
96.7
-3.3%
-0.6%
Europe Index
Index, %change YTD
Index, %change from August 20
Chuo Gyorui Co Ltd Japan 131 349.0 -4.1% nmf 14.4
Uoriki Co Ltd Japan 172 1352.0 -2.9% 12.0 23.1
Kyokuyo Co Ltd Japan 189 199.0 -21.0% n/a 15.1
Nichiro Corp Japan 222 159.0 -28.1% nmf 15.4
Sea Horse Corp Pub Co Ltd Thailand 238 2.8 -20.0% n/a n/a
Pacific Andes Intl Hldg Ltd China 542 2.4 32.0% n/a 10.0
Maruha Group Inc Japan 551 176.0 -26.7% n/a nmf
Thai Union Frozen Prod Pub Thailand 640 23.9 -4.4% 8.5 9.8
China Fishery Group Ltd China 972 1.9 19.5% 12.1 19.2
Nippon Suisan Kaisha Ltd Japan 1,460 605.0 -13.4% n/a nmf
12m EV/EBITDA 12M P/E Change (%) in share price YTD Current share price M.Cap m.USD Company Country
Asia
Index: January 1, 2007 = 100
Sources: Bloomberg, Individual Stock Exchanges, Company Annual and Quarterly Reports Revenues, Glitnir. Data as of September 25, 2007, "nmf" = not meaningful, "n/a" = not
available.
Disclaimer: The companies on the list have been selected by Glitnir. Glitnir banki hf. hereby disclaims liability and does not accept any responsibility for such information or is giving
any advice in relation to investments in those companies.
in cooperation withGlitnir 2007 38
Introduction to Glitnir
• Home markets are Iceland and Norway
• Focus on niche segments worldwide
Seafood Industry, Sustainable Energy & Shipping – Offshore Service Vessels
• Strong focus on the seafood industry since 1904
• Today 8% of the bank’s loan portfolio is in the seafood industry
• Credit ratings:
Aa3 / P-1 (Moody’s), A / F1 (Fitch) and A-/A-2 (Standard and Poor’s)
Credit facilities
z Term loan facilities
z Working capital facilities
z Syndicated loans
z Vessel financing
z Bridge loans
Capital Markets
z Bond issuances
z FX dealings
z Forward contracts
z Options
Mergers & acquisitions
z Financial advisory
z Acquisitions
z Disposals
z Minority investments
z MBOs / LBOs / MBIs
z Private Placements
z Strategic reviews
Other services
z Risk management advisory
z Equity participation
Our services include:
Glitnir’s total loan portfolio $24 billion*
* as of June 30, 2007
Fishing
industries
8%
Services
25%
Individuals
20%
Industry
8%
Commerce
4%
Others
5%
Real estate
30%Glitnir 2007 39
Glitnir International Banking
Reykjavik, Iceland
Glitnir Group, Headquarters
New York City, U.S.
Glitnir Capital Corp.
Halifax, NS/ Canada
Glitnir Representative Office Canada
Shanghai, P.R. China
Glitnir Representative Office China
Magnús Bjarnason. Executive Vice
President, International Banking
Jonathan Logan. Managing Director
Business Development U.S. & Canada
Joe Fillmore. Chief Representative Zhu Jiang. Chief Representative
z Corporate Credit
z Corporate Finance
z Seafood Team
z Corporate Credit & Corporate Finance
z Support of Glitnir clients in the U.S.
market
z Support of industry niche market
teams, e.g. food/ seafood, sustainable
energy & offshore service vessels.
z Promotion of Glitnir & its services
conducted from Iceland
z Currently applying for turning office
into a branch
z Support of industry niche market
teams, e.g. food/ seafood, sustainable
energy & offshore service vessels.
z Promotion of Glitnir & its services
conducted from Iceland
z Support of Glitnir clients in China
z Support of industry niche market
teams, e.g. food/ seafood, sustainable
energy & offshore service vessels.
Address
Glitnir banki, International Banking
Kirkjusandi, 155 Reykjavik Iceland
Tel: +354 440 4519
Fax: +354 440 4520
Address
Glitnir Capital Corporation, 222 East 41st
Street, New York NY 10017, U.S.
Tel: +1 212 922 0228
Fax: +1 212 922 0882
E-mail: jonathan.logan@glitnirusa.com
Address
1718 Argyle Street, Suite 810, Halifax,
NS, B3J 3N6 Canada
Tel: +1 902 429 3114
Fax: +1 902 422 0288
E-mail: joe.fillmore@glitnir.is
Address
Glitnir Shanghai, Level 8, CitiGroup
Tower, 33 Hua Yuan Shai Qiao Road,
Pudong, Shanghai 200120, P.R. China
Tel: +86 21 5882 5088
Fax: +86 21 5882 5388
E-mail: jiang.zhu@glitnir.is Glitnir 2007 40
Glitnir European Offices (I)
London, UK
London Branch
Luxembourg
Glitnir Bank Luxemburg S.A.
Copenhagen, Denmark
Copenhagen Branch
Norway
Glitnir Bank
z Business Management
z Debt Finance & Loan Syndication
z Leveraged Finance
z Corporate Finance
z Funding
z Centre of Excellence: Food industry
z Corporate Banking
z Centre of Excellence
−Real Estate
z Private Banking
z Leveraged Finance
z Corporate Finance
z Glitnir Bank
−Corporate and retail mortgage
−Full service bank, trad. indust.
−Centre of Excellence
− Shipping/ Offshore service
vessels
z Glitnir Factoring
z Glitnir Securities
z Glitnir Property Group
Address
Glitnir London
7th floor, 41 Lothbury,
London EC2R 7HF
United Kingdom
Tel.: +44 (0) 20 7710 9100
Fax.: +44 (0) 20 7710 9101
Address
Glitnir Bank Luxembourg S.A.,
534, rue de Neudorf, L-2220 Luxembourg
Mailing Address: P.O. Box 1647, L-1016
Luxembourg
Tel.: +352 266 864-1
Fax: +352 266 864- 64
Address
Glitnir Bank, Copenhagen Branch
Frederiksgade 19, 2nd floor
DK-1265 Copenhagen, Denmark
Tel: +45 8833 5000
Fax: +45 8833 5001
Address
Dronningensgate 40; P.O. Box 282,
Sentrum; N-0103 Oslo, Norway
Tel: +47 22 82 56 90
Fax: +47 22 82 56 91 Glitnir 2007 41
Glitnir European Offices (II)
Reykjavik, Iceland
Glitnir Group, Headquarters
Sweden
Glitnir AB
Finland
FIM Group
Moscow, Russia
FIM Financial Services
z Corporate Banking
z Investment Banking
z Centres of Excellence
− Global Seafood
− Sustainable Energy
z Structured Finance
z Capital Markets
z Glitnir Securities
− Equity Trading & Brokerage
z FIM Kapitalförvaltning Ab,
Finland Filial
z Funds
z Structured Products
z Asset Management
z Brokerage
z Investment Banking
z Glitnir Bank Ltd.
−Banking (Oct.’07)
z Funds & Structured Products
z Asset Management
z Brokerage
z Investment Banking
Address
Glitnir banki
Kirkjusandi, 155 Reykjavik Iceland
Tel: +354 440 4500
Fax: +354 440 4001
Address
Hovslagargatan 3; Box 16027,
103 21 Stockholm, Sweden
Tel: +46 8 463 85 00
Fax: +46 8 611 64 05
Address
Pohjoisesplanadi 33 A
00100 Helsinki, Finland
Tel. +358 (0)9 613 46 250
Fax. +358 (0)9 613 46 360
Address
Paveletskaya sq. 2, bldg 3
115054 Moscow, Russia
Tel. +7 495 545 0535
Fax +7 495 545 0536 Glitnir 2007 42
Iceland
Glitnir Seafood Team
Magnús Bjarnason
Executive Vice President
International Banking
Direct line: +354 440 4523
Mobile: +354 844 4523
magnus.bjarnason@glitnir.is
Helgi Anton Eiríksson
Executive Vice President
Investment Banking
Direct line: +354 440 4518
Mobile: +354 844 4518
helgi.eiriksson@glitnir.is
Kristján Th. Davídsson
Managing Director
Global Seafood – Intl. Banking
Direct line: +354 440 4517
Mobile: +354 844 4517
kristjan.davidsson@glitnir.is
Ragnar Gudjónsson
Director
Corporate Banking Iceland
Direct line: +354 440 4550
Mobile: +354 844 4550
ragnar.gudjonsson@glitnir.is
Hjálmur Nordal
Director
Corporate Banking Iceland
Direct line: +354 - 440 4522
Mobile: +354 - 844 4522
hjalmur.nordal@glitnir.is
Ásmundur Gíslason
Analyst l Seafood
Direct line: +354 440 4768
Mobile: +354 844 4768
asmundur.gislason@glitnir.is
Valdimar Halldórsson
Analyst
Direct line: +354 440 4638
Mobile: +354 844 4638
valdimar.halldorsson@glitnir.is
Guðmundur Hjaltason
Executive Vice President
Corporate Banking
Direct line: +354 440 4515
Mobile: +354 844 4515
gudmundur.hjaltason@glitnir.is
Bjarni Hjaltason
Managing Director
International Banking
Direct line: +354 440 4788
Mobile: +354 844 4788
bjarni.hjaltason@glitnir.isGlitnir 2007 43
Joe Fillmore
Director
Canada
Direct: +1 (902) 429 3114
Mobile: +1 (902) 237 2114
joe.fillmore@glitnirbank.com
North America
Jonathan Logan
Managing Director
North America
Mobile: +1 (203) 979 5275
jonathan.logan@glitnirbank.com
Michael Richard
Director
United States
Mobile: +1 (508) 878 0171
michael.richard@glitnirbank.com
Natasha Sideris
Associate
Canada
Direct line: +1 (902) 429 3115
Mobile: +1 (902) 441 9190
natasha.sideris@glitnirbank.com
Asia
Jiang Zhu
Director
Glitnir Rep. Office China
Direct: +86 21 6101 0190
Mobile: +86 139 0161 1875
jiang.zhu@glitnirbank.com
Grace Liu
Executive Assistant
Glitnir Rep. Office China
Direct: +86 21 6101 0191
Mobile: +86 136 6166 1660
grace.liu@glitnirbank.com
Hafliði Sævarsson
Analyst
Glitnir Rep. Office China
Direct: +86 21 6101 0191
Mobile: +86 138 1807 2218
haflidi.saevarsson@glitnirbank.com
Bjartur Logi Ye Shen
Analyst
International Banking
Direct: +354 440 4560
Mobile: +354 844 4560
bjartur.shen@glitnir.is
Glitnir Seafood – Regional Teams
Ignacio Kleiman
Head of Corporate Finance
International Banking
Direct: +1 (212) 922 0228
Mobile: +1 917 578 349
ignacio.kleiman@glitnirbank.com
Eyþór Eyjólfsson
Director – Japan and Oceania
International Banking
Direct: +354 440 4738
Mobile: +354 844 4738
eythor.eyjolfsson@glitnir.is
Jón Kr. Jóhannsson
Analyst
Canada
Direct: +1 (902) 429 3116
Mobile: +1 (902) 448 7967
jon.johannsson@glitnirbank.comGlitnir 2007 44
Europe/Nordic
Kjartan Ólafsson
Director
Glitnir Securities - Norway
Direct: +47 2287 8613
Mobile: +47 9592 6015
kjartan.olafsson@glitnir.no
Ola Övrelid
Bank Executive
Glitnir Bank - Norway
Direct: +47 7010 2026
Mobile: +47 9133 6733
ola.oevrelid@glitnir.no
Henning Lund
Analyst
Glitnir Securities - Norway
Direct: +47 2201 6347
Mobile: +47 9525 5839
henning.lund@glitnir.no
Kristján Hjaltason
Director
Glitnir Bank - Denmark
Direct: +45 - 8833 5081
Mobile: +45 - 5199 5081
kristjan.hjaltason@glitnir.dk
Glitnir Seafood – Regional Teams
Glenn Kristiansen
Director
Glitnir Securities - Norway
Direct: +47 - 2201 6392
Mobile: +47 – 9117 9105
glenn.kristiansen@glitnir.no
South America
Jón Garðar Guðmundsson
Managing Director
Emerging Markets
Direct: +354 440 4516
Mobile: +354 844 4516
jon.gudmundsson@glitnir.is
Kurt Kvalsvik
Director
Glitnir Bank - Norway
Direct: +47 7010 2015
Mobile: +47 – 9480 9016
kurt.kvalsvik@glitnir.no
Hjörtur Thor Steindórsson
Credit Manager
International Corporate Credit
Direct: +354 440 4503
Mobile: +354 844 4503
hjortur.steindorsson@glitnir.is
Sverrir Ingi Ármannsson
Analyst
International Banking
Direct: +354 440 4528
Mobile: +354 844 4528
sverrir.armannsson@glitnir.is
Guðjón Sverrisson
Senior Credit Manager
International Banking
Direct: +1 212 71 60 105
Mobile: + 646 696 86 55
gudjon.sverrisson@glitnirbank.comGlitnir 2007 45
Gísli Sigurgeirsson
Senior Manager
International Corporate Credit
Direct line: +1 212 716 0107
Mobile: +1 917 355 0057
gisli.sigurgeirsson@glitnirusa.com
Tim Owen
Executive Director
Head of Corporate Finance, UK
Direct line: +44(0) 20 7710 9130
Mobile: +44(0) 7843 512 092
tim.owen@glitnir.is
Timothy H. Spanos
Executive Director
International Corporate Credit
Direct line: +354 440 4777
Mobile: +354 844 4777
timothy.spanos@glitnir.is
Kyrre Dale
Credit Manager | Glitnir Bank
Seafood Credit, Norway
Direct line: +47 7011 2034
Mobile: +47 9137 6551
kyrre.dale@glitnir.no
Glitnir Seafood Team – Other Members
Atli Rafn Björnsson
Director
Corporate Finance
Direct line: +354 440 4739
Mobile: +354 844 4739
atli.bjornsson@glitnir.co.uk
Snorri Arnar Vidarsson
Credit Officer
Corporate Banking Iceland
Direct line: +354 440 4771
Mobile: +354 844 4771
snorri.vidarsson@glitnir.is
Eiríkur R. Eiríksson
Senior Manager
Corporate Risk Advisory
Direct line: +354 440 4565
Mobile: +354 844 4565
eirikur.eiriksson@glitnir.is
Rúnar Jónsson
FX Brokerage
Capital Markets
Direct line: +354 440 4489
Mobile: +354 844 4489
runar.jonsson@glitnir.is
Stefán Eiríks Stefánsson
FX Brokerage
Capital Markets
Direct line: +354 440 4483
Mobile: +354 844 4483
stefan.stefansson@glitnir.is
Ingi Rafnar Júlíusson
Executive Director
Capital Markets
Direct line: +354 440 4459
Mobile: +354 844 4459
ingi.juliusson@glitnir.is
Davíð Stefánsson
Analyst
Corporate Finance, UK
Direct line: +44(0) 20 7710 9136
Mobile: +44(0) 788 795 4877
david.stefansson@glitnir.is
Merete Stokke Nesdal
Account Manager | Glitnir Bank
Seafood Credit, Norway
Direct line: +47 7010 2016
Mobile: +47 926 67 511
merete.stokke.nesdal@glitnir.noGlitnir 2007 46
Legal Disclaimer
All opinions and analyses represent the views of Glitnir at the time of writing and are subject to change without
notice. Glitnir and its employees cannot be held responsible for any trading conducted on the basis of the
information and views presented here. Glitnir may at any time have vested interests in individual companies, for
example as an investor, creditor or service provider, but its opinions and analyses are produced independently by
the Glitnir Research division, based on publicly available information on the company in question.
This Seafood Industry Report was written by:
Joe Fillmore, Managing Director – Glitnir Halifax joe.fillmore@glitnirbank.com
Natasha Sideris, Associate - Glitnir Halifax natasha.sideris@glitnirbank.com
Jón Kr. Jóhannsson, Analyst – Glitnir Halifax jon.johannsson@glitnirbank.com
Alexander Richter, Associate – Glitnir Reykjavík alexander.richter@glitnir.iswww.glitnir.is/seafood
 davido.extraxim@gmail.com