Salmon dominates Chile’s food exports in 2020, despite value decrease

The value of Chile’s salmon exports reached USD 4.4 billion (EUR 3.6 billion) in 2020 despite the COVID-19 pandemic, placing the commodity at the top of the country’s food exports and in second place for exports overall – behind only the country’s cash cow, copper.

While salmon remained an important export commodity in 2020, according to the latest report from the Chilean Salmon Council, the amount of salmon exported in dollar terms was 14.6 percent lower than in 2019. The lower value came despite a larger export total, which grew to 779,044 metric tons (MT) – up 7.5 percent compared to the previous year. The lower value was largely related to how prices were impacted by the COVID-19 pandemic, as lower sales to the hotel, restaurant, and catering (HORECA) channel suffered due to closures and operational limits put in place by governments seeking to prevent spread of the novel coronavirus.

Salmon exports represented 6.1 percent of Chile's total exports, 12.4 percent of exports of non-copper goods, and 46 percent of total food exports. The third- and fourth-place exported products were cherries, totaling USD 1.6 billion (EUR 1.3 billion), and bottled wine, which totaled USD 1.5 billion (EUR 1.2 billion), according to the council’s Quarterly Export Report.

At the same time, the relative importance of salmon in exports has practically doubled in the last decade, moving from 6.9 percent of exports of non-copper goods in 2010, to 12.4 percent in 2020 – expanding at an annualized growth rate of 8 percent. In comparison, exports of goods and non-copper goods increased during the same period at an annualized average rate of 0.1 percent and 1.8 percent, respectively.

“If we take stock of the figures from the last 10 years, we can see that salmon has been gaining relevance in Chilean exports,” Salmon Council Executive Director Joanna Davidovich – who was tapped for the position in July – said in a release. “Salmon exports have had an average growth significantly higher than the rest of the exports, which has generated jobs and a virtuous circle of suppliers, entrepreneurs, innovation, and regional development.”

The price decreases were largely unrelated to the performance of the salmon farming sector, which Davidovich credited to companies taking swift action to prevent interruptions caused by the COVID-19 pandemic.

“Despite how complex last year was for various economic sectors, salmon farming companies were able to continue operating thanks to the adoption of strict safety protocols and safeguarding the health of employees, which allowed for operational continuity, and most importantly, which meant that industry-generated jobs were kept, most of them in the regions of Los Lagos, Aysén, and Magallanes,” she said.

For the full year, Chile’s main destination markets for salmon exports were the United States, Japan, Brazil, Russia, and China, which collectively covered 81.4 percent of total salmon exports. Although Chile's export value in these five main markets fell in 2020, export volumes increased in its three largest markets: the U.S., Japan, and Brazil.

Chile’s relationship with Russia was strained last year when it came to salmon exports. Russia’s veterinary service, Rosselkhoznadzor, placed a number of Chilean salmon plants on restriction after Russian health authorities reportedly detected traces of crystal violet and antibiotics (oxytetracycline) in farmed salmon. In turn, Chile’s national fisheries agency, Sernapesca, scrambled to work with Russian counterparts to try to streamline approval for the Chilean producers and get them off the restricted list.

Meanwhile, in China, local seafood shoppers were spooked last year by a supposed linkage between salmon and the coronavirus, after health authorities found the virus on fish chopping boards in Beijing’s Xinfadi seafood market – one of the epicenters of a cluster of COVID-19 infections. With the unfounded scare that imported salmon were infected with the virus, sales of imported seafood across China plummeted. That fear was exacerbated at the time by top Chinese medical experts warning the public to avoid eating salmon. To make up for lost business, Chilean salmon farmers turned their focus to the U.S. and Brazil to increase sales.

Back in Chile, in quarterly terms, salmon and trout exports totaled USD 1.12 billion (EUR 928 million) in the last three months of 2020, 14.6 percent down from the same quarter of the previous year.

“However, the decline in the fourth quarter was less than that registered in the third quarter of the year, and a recovery in exports was observed during the last months of 2020,” Davidovich said..

Davidovich said she anticipates that as the COVID-19 vaccination is more widely distributed – helping to bring an end to the health crisis – the recovery of sales in the HORECA segement, added to the launch of new distribution channels in online and retail formats, will provide for a more profitable 2021 for the salmon farming industry.

The Chilean Salmon Council, formed in May 2020, is an association that groups four salmon-producing companies – AquaChile, Cermaq, Mowi, and Salmones Aysén – which together represent about half of Chilean salmon production.  

Photo courtesy of AquaChile