Feed Costs Soar, 27 Companies Collapse: Japan's Aquaculture Sector Hit by Coldest Spell in a Decade!
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Feed Costs Soar, 27 Companies Collapse: Japan's Aquaculture Sector Hit by Coldest Spell in a Decade!
According to a survey released by Japan's Teikoku Databank (TDB) on September 6, between January and August 2025, Japan's aquaculture industry saw 7 bankruptcies and 20 suspensions or dissolutions, with a total of 27 companies exiting the market. This figure not only far exceeds the full-year total of 19 in 2024, but may also set a new record high for the past 10 years.
Multiple Pressures Behind the Wave of Collapses
The reasons driving the accelerated reshuffling of the aquaculture industry are complex. First, climate change has become a core driver. In recent years, seawater temperatures have continued to rise, and juvenile fish mortality has increased markedly, directly hitting survival rates and shipment volumes in the farming segment. Second, soaring feed prices are continuously eroding profits. Feed costs, which rely on imports, have risen sharply, pushing many companies into operational difficulties.
At the same time, the industry's heavy dependence on climate and market prices makes its operations highly volatile. Uncertain factors such as abnormal water temperatures, typhoon disasters, and falling fish prices can all cause sharp fluctuations in corporate revenue. In particular, after the outbreak of COVID-19, demand through restaurant channels dropped sharply, making things even worse for many farmers dependent on the foodservice market.
A Turning Point from Boom to Contraction
In fact, the aquaculture industry experienced a "golden development period" over the past decade or so. As natural fishery resources faced the risk of depletion, many large seafood companies actively expanded into aquaculture, driving rapid expansion across the industry. Especially around 2017, with the development of land-based aquaculture technology, barriers to entry were lowered, and new aquaculture companies established within a year once reached 39, with industry enthusiasm at an unprecedented level.
However, behind the expansion and boom lay structural fragility. Many companies made large investments during market upswings, and debt levels rose sharply. Once market conditions reversed or costs spiraled out of control, debt-servicing pressure would amplify, and cash flow chains could easily break. The wave of bankruptcies in 2025 is precisely the result of years of accumulated "high-risk operations" gradually coming to a head.
Financial Data Highlights the Difficulties
According to TDB monitoring, the operating conditions of aquaculture companies in fiscal 2024 already showed signs of fatigue. Data shows that the proportion of companies with declining profits reached 29.5% compared with the previous year, the highest level since COVID-19; companies in the red accounted for 34.1%, exceeding 30% for the first time in three years. Combined, the proportion of companies with deteriorating performance reached 63.6%, a full 14 percentage points higher than the previous year.
Particularly noteworthy is that land-based aquaculture projects, which have drawn close attention from capital markets in recent years, have not been spared. Dragged down by factors such as high electricity prices, many companies have likewise fallen into declining profits or even losses. This shows that even in newer fields with higher technical content and high expectations, the aquaculture industry still struggles to escape the constraints of cost pressure and market volatility.
Risk Warning
The current wave of bankruptcies and suspensions is both a product of the overlap between global climate change and economic cycles, and a reflection of the aquaculture industry's fragility from over-reliance on markets and the environment. In the future, the industry may further accelerate consolidation, and the survival space for small and medium-sized enterprises will be severely squeezed. How to find a balance among technological innovation, risk management, and cost control will determine whether the aquaculture industry can emerge from its difficulties.
In the short term, with continued volatility in farmed fish prices, climate uncertainty, and feed cost pressure, the industry's bankruptcy risk remains high. For investors, farmers, and even policymakers, this data is undoubtedly a wake-up call.
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