1. Ministry of Fisheries' priority project on added-value for marine catch (AVS project) Friðrik Friðriksson, chairman of Rf, Icelandic Fisheries Laboratories and AVS steering group September 6th. 2002

2. Seafood value chain l1. Raw material Enviromental issues, handling, pretreatment, storage, new species l2. Processing Primary processing : Heading, gutting, filleting, salting, freezing, transport, traceability Seccondary processing: Thawing, smoking, drying, marinating l3. Byproducts From cod, herring, capelin, shrimp l4. Aquaculture Species, methods, production, feed l5. Biotechnology Enzymes, proteins, medicine l6. Equipment & competence Machines, programming, counseling

3. .. and other important issues, cross value chain.. and other important issues, cross value chain Food safety Quality Traceability Transport Markets Consumers

4. Export value of seafood and related products (IKK milliards)

5. Seafood export value in USD (fob)

6. Is there a need for special effort to increase value of seafood? lStatistics tell that growth in the industry over last decade has been insufficient lThere are great opportunities for increased value within seafood in Iceland lContinuous effort and vision needed over the whole field lSuch an effort should be stimulating for companies and has to be in line with their longterm interests lTherefore Iceland’s Minester of Fisheries says yes to the question that there is a need for new inititives

7. Stearing group for increased value of seafood (AVS) since January 2002 l9 members from industry, markets, research and university environment form the group appointed by the Minester of Fisheries lSteering group has worked extensively since January in analysing the current status and preparing proposals lIt has met with many people and local interest groups lSome members made a field trip to Norway/Denmark lA full working day in May with 60 people from industry for information sharing and consultation lFinal paper and recommendations to be presented to the Minester early October 2002.

8. Main tasks of the stearing group 2002 lTo map the six main fields, raw material, processing, aquaculture, biotechnology, equipment and competence where opportunities lie for AVS and define projects which would lead to more value in each field lTo investigate what has been done in these fields in other countries, esp. Norway and Denmark and bring positives to Iceland lTo look for and enhance better understanding within the fishing industry that an effort in Increased Value of Seafood (AVS) is needed

9. ...... stearing group 2002 lTo define the role of government, industry and other intrested parties lTo set measurable goals for 5 years effort to increase value of seafood and related products. Where do we want to be in 5 or 10 years ? lTo propose ways to finance AVS projects during the next 5 year lTo make recommendations regarding the management of the AVS program during 2003-2007

10. What Norwegians have done: Founding the new FHF fund 2001 The industry took the initiative, the board of FHF comes mainly from industry Totally new source of funding R&D in seafood The income for the fund is a 0,3% tax on export of seafood from Norway, self imposed by industry The fund has around 1.200 million IKK for the first year in budget

11. The FHF - Fund The board sets the main guidelines for how to split the funds as below with three year horizon. The 1.100 million goes to: General projects for the industry279 Fishing and catch239 Fish industry and production272 Aquaculture224 Small projects and planning 45 Information 22 Evaluation 22

12. Annual funds in Iceland for seafood research and development lAnnual state budget funding130 million IKK lIcelandic Research Council 50 “ lEC 50 “ lNordic funds 30 “ lMinestries and institutions 30 “ lIndustry 30 “  Total about 310 millions IKK goes to R&D in the seafood industry annually or 0,3% of export value.

13. The industry should lead new inititives in AVS lImportant that the industry is responsible for projects coming from AVS lCreate a common forum for research and industry to cooperate lGovernment can facilitate new programs, and increase funds allocated to R&D lAVS steering group’s proposal will be address vision as well as programs that will to foster growth in industry.

14. Role of government in AVS, a plan should be in place lSustainable fisheries lEnviromental monitoring; clean ocean lFood safety lEducation lBasic research lFunding for R&D projects lCreate financial and competetive environment for companies in Iceland lNew development lVenture capital lEnsure market access internationally

15. ….further role of government lPlay leading part in offering vision for the fishing industry in Iceland lPosition Iceland among other fishing nations on the market place lCreating the AVS program and securing support and financing is part of that.

16. Potential growth in seafood value (IKK milliards) 2007 and 2012