Barriers to entryLocation Farming of Atlantic salmon has always been dominated by a few producing countries as there are several natural conditions that have to be in place for optimal production. As salmon is a cold-blooded animal, the temperature plays an important role for its growth rate. With high seawater temperatures, disease risk increases. Temperatures below zero degrees Celsius, causes mass mortality. The optimal temperature range for Atlantic salmon is 8-14 degrees Celsius. Due to these constraints most salmon fish farming is preformed in Norway, Chile, UK, Faroe Islands and Canada. T Licenses Norway and Chile The limited number of licenses is a major entry barrier to the industry. Companies with GSF size may have a competitive advantage compared to smaller market participants due to the high prices of licenses. Also the 25 % market share- limit, prevent Marine Harvest to grow any further, as the company has already reached this limit in Norway. In the rest of the world there are no limitations on the number of licenses. Economies of scale The salmon farming industry is a capital intensive and volatile business. This is a result of a long production cycle, a fragmented industry and expensive licenses and equipment. Major companies in the industry, like Marine Harvest, have therefore stated that there are substantial potential for consolidation in the industry, which they believe will secure increased operational efficiency in the value chain
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