Nova Austral and Salmones Austral launch JV for salmon production in Magallanes

Chilean salmon farmers Nova Austral and Trusal S.A., a subsidiary of Salmones Austral, have agreed to form a joint venture (JV) for the production of salmon with three licenses on Skyring Sound in southern Chile’s Magallanes Region, the companies announced in a joint statement.

The JV expects to harvest a total of 19,000 metric tons (MT) during two production cycles – 7,000 MT during 2021 and 12,000 MT in 2022 – with the aim of extending the venture over a longer period, the companies said, without specifying the amount of time it may be extended.

Under Trusal’s licenses, smolts are to be provided from Nova Austral's new hatchery in Porvenir. Salmones Austral is to supply the feed, three concessions, and fixed assets for two of the centers. In turn, Nova Austral will operate the farm sites, process at its Porvenir facility, and sell the salmon through its brand Sixty South. The proceeds from the JV are to be split evenly.

Nova Austral is owned by the equity funds Altor Fund III and Bain Capital. Its entire operations are in the Magallanes and Antarctic regions, employing some 800 people directly. In September last year, Chile’s Sub-Secretary of Fisheries and Aquaculture (Subpesca) cut Nova Austral’s production permits after it was discovered the company provided false mortality figures to regulators.

The firm had faced scrutiny since June, when Chilean press reported an attempt to manipulate the company’s reported mortality rates. In response, Sernapesca, the country’s fisheries and aquaculture regulator, filed three complaints against the company for knowingly misleading authorities through false reporting of information, and the Aquaculture Stewardship Council terminated a logo licensing agreement on all of Nova Austral’s products while it carries out its own independent investigation.

For its part, Salmones Austral was created in 2013 after the merger of Trusal and Pacific Star. Today, it has annual production of some 45-50,000 MT which are exported to more than 20 countries, with more than 1,200 workers operating in two process plants and 20 freshwater and seawater farming centers in the regions of Maule, Biobío, La Araucanía, Los Lagos, and Aysén.

The JV will mark Salmones Austral’s first operations in the Magallanes Region.

Photo courtesy of Nova Austral