Scottish Sea Farms’ move to Lerwick costs the council dear

SHETLAND Islands Council is losing out on hundreds of thousands of pounds of income after a leading salmon company moved processing facilities from Scalloway to Lerwick.

Scottish Sea Farms finished a £2.5 million revamp of its existing Lerwick facility last year, doubling the maximum daily processing capacity from 100 to 200 tonnes.

Given the extra capacity the company has ceased processing operations at its facility at Blacksness Pier in Scalloway and has focused activity in Lerwick.

The move has resulted in Shetland Islands Council (SIC) losing out on hundreds of thousands of pounds worth of salmon landing fees at Blacksness Pier.

A report which will be presented to councillors on the SIC’s harbour board next week shows that for the current 2023/24 financial year income from these landing fees has dropped by almost half a million pounds.

For the 2024/25 financial year the loss of income is estimated to be £718,000.

Scottish Sea Farms said expanding its Lerwick processing facility made sense partly because of its proximity to the ferry network, as well as the site’s larger footprint. Landing fees in the town would be paid to Lerwick Port Authority, which is separate to the council.

The Lerwick base, which has around 80 workers, also takes in salmon from Scottish Sea Farms’ Orkney sites as there is no processing facility there.

The Scalloway base will now provide a “secondary harvesting hub” during periods of peak volumes and will be supporting many of the company’s other farming activities.

Meanwhile figures included in next week’s meeting papers show that the SIC’s harbour board activity is expected to bring in a surplus of nearly £14 million this financial year.

However, this is around £4.7 million less than budgeted.

A key reason behind this are fewer tanker movements at Sullom Voe, due to maintenance work reducing oil export levels.

For 2024/25 the estimates are that the harbour board would have a reduced surplus of £11.2 million, with reduced tanker movements again a key reason as well as pay awards.