Some 627,000 fish, or 1,500 tonnes, were lost due to biological challenges caused by abnormal levels of jellyfish between July and September.
Parts of the operation will be liquidated immediately while operations at the two remaining sites will be shut down after harvest in Q4 2020 – Q1 2021.
Combined with weak market prices impacted by the Covid-19 pandemic, and low harvest weight, the event will impact Grieg Seafood’s result for the third quarter negatively with losses of approximately NOK 100 million.
Remaining fish in the area will be harvested in Q4 2020 – Q1 2021, with expected high costs as a result of the incident.
Grieg Seafood initiated an evaluation of its Skye operations in August 2019. There are few operational synergies between Grieg Seafood’s main operations in Shetland and the five farms on Skye due to the long distance between the areas, the company said in a press release.
‘With limited potential for increased volumes and challenging conditions for operational integration reducing ability to mitigate and control biological challenges, Grieg Seafood does not see potential to maintain operations with the fish welfare and production cost standard that it has for the rest of the company under the current structural set-up.’
Grieg Seafood CEO Andreas Kvame said: ‘In this area, it has proven difficult to maintain the fish welfare and production standard we have in the rest of the company, due to the long distance and weak operational synergies between our main operations in Shetland and the five farms in Skye.
‘Therefore, we see no other choice but to liquidate our operations in Skye, as we look for alternatives for the sites outside the company.
‘Our staff in Skye have done a tremendous job despite less than optimal conditions, and I want to thank them for their hard work and dedication to Grieg Seafood.’
Grieg Seafood’s main operations in Scotland, on the Shetland isles, have had good and stable biology so far during the quarter and Grieg Seafood’s guiding of 95,000 tonnes harvest in 2020 remains.