COVID-19 to impact Benchmark's Advanced Nutrition Division sales
The company said that there is ongoing uncertainty and they expect a significant impact from COVID-19 on the division.
Benchmark said in a statement that “to date, it is too early to assess the level of impact in the current financial year ending on September 30 2020, but we anticipate a negative impact on earnings.”
“Trading in our Genetics business has not been materially affected by COVID-19. The two and a half to three-year salmon production cycle means that demand for salmon eggs is less affected by the short term impact from COVID-19 on the salmon sector, which is experiencing weaker demand from the catering industry, partially offset by retail demand, as well as challenging logistics to Asia and the U.S.,” the statement reports.
Global shrimp consumption has dropped, with a consequent reduction in production in most markets. There are cautious signs of a potential recovery in China, although the effect will be slowed by a backlog of shrimp stocks from prior months. Demand for seabass and seabream in Europe and in the U.S. has been significantly impacted, leading to a reduction in production across all markets which could worsen if European borders close to fry or end product. The company said that there is ongoing uncertainty and they expect a significant impact from COVID-19 on the division. In the animal health division, the company has built stocks to support customers and trading is on track.
“During these difficult times, the group's key priority is to protect our employees and customers' interests whilst at the same time ensuring our financial position remains resilient. We operate in the essential sustainable global food production sector which, while experiencing short term challenges from COVID-19, continues to have strong fundamentals. We remain confident in our strategy for the business for the long term including the prospects for the commercial launch of BMK08 and CleanTreat,” Peter George, executive chairman, said.