Multiexport estimates USD 9 million loss due to HAB

[Chile] Multiexport Foods informed the Superintendency of Securities and Insurance (SVS) has completed the tasks of capture and mortality disposal of its five salmon farms affected by harmful algal bloom. In addition, it has also performed moves and fish counting in the affected centres, which have returned to normal operation.

The company estimates that the aggregate biomass losses in the affected centres, at that time containing fish between 0.9 and 4.3 kg of average weight is 5,203 tonnes of Atlantic salmon biomass. This volume is equivalent to 45 per cent of the total biomass of these centres and represents a total cost of USD 26.6 million.

In a note sent to the SVS, the company states that all its fattening centres that were affected in the first two months of this year due to the algal blooms that occurred in the regions of Los Lagos and Aysen are insured with coverage “with individual deductible per centre that are between 8 per cent and 20 per cent on the book value of the biomass, apart from an annual aggregate deductible of USD 2.5 million for the entire company.”

“The estimated amount of the direct loss of biomass that our subsidiary must recognize in the financial statements of 2016 reaches the figure of USD 9 million, equivalent to the amounts corresponding to the estimate of deductible explained above. To the previous amount the policy deductible will additionally need to be added in relation to mortality and mitigation capture costs coverage, which are estimated in the amount of USD 0.4 million,” the general manager of the company Andres Lyon stated.

To mitigate the effects of HAB (harmful algal blooms) events and the consequent loss of biomass associated with the production of 2016, the company has provided resources and is making productive efforts for this purpose. Multiexport managers estimate a reduction of approximately 6 per cent compared to the latest harvest projection for 2016 delivered by the company to the financial market on November 27, 2015.

Multiexport manager added in the report sent to the SVS that 2017 production “will not be affected as a result of the above”.


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