Hello everyone, and welcome to this Q2 presentation by Nordic Aqua Partners. With us today, we have the management team who will be presenting the results for you this morning. I just wanna let everyone know that if you have any questions, you may ask these in writing in the Q&A function here in the app, and I will read them out loud to the management team after. With that, I leave the word to you, Ragnar.
Thank you so much, Charlotte. Welcome to the Q2 presentation by Nordic Aqua Partners. Today we're going through the highlights, project review, say a few words about the market, some assumptions and KPIs, financials, and we will end with the outlook and summary. Starting with the highlights. The project is still on time and on budget. Since last time, we have installed the second RAS facility, RAS 2, and that's completed, and fish are transferred from RAS 1 to RAS 2. That was in mid-July. The biology is going well. It's going a little better than planned. The fry are 3 grams. Still small, but growing bigger. As you will see later in the presentation, prices in China have been very.
The CapEx, we have spent 56 million DKK in the period, Q2 , and now are up at 188 million DKK. That is approximately 50% of the 370 that the project cost is set at. The available liquidity is now 428 million DKK as of end of June. That is cash, including undrawn credit facilities. Just a reminder of who we are and where we are. We are centered just south of Shanghai. We are fully funded to reach the first 4,000 tons of production, which is the project that we are aiming for in stage 1. We do also have the equity in place for doubling that up to 8,000 tons.
We have mentioned before that we have an existing plan of getting up to 20,000 tons. It is possible also to get up to 50,000 tons at the same site. We have, as we have mentioned before, also options of going to establish our company in Beijing and close to Hong Kong. If we look at where we're located, within 5 hours drive, we can reach 100 million consumers. The market is very good and close. Also, if we use train combined with cars, we can reach up to 800 million consumers within 12 hours. All of China can be reached within 24 hours. The market is very big where we're located.
We have a very strong RAS team and also a team in China that has long experience doing business there. We have dedicated support from the local authorities and strong industry partners in Nutreco and AKVA Group. Ove will now take us through the project review.
Thank you, Ragnar, and good morning to you all. Let's start with the most important thing. The project is continuing according to time and on budget, and we see no reason why that should not continue going forward. The construction is now in full swing, and finally, something is happening above ground, so it's more visible. I'll come back to some details a little bit further on in the presentation. The installation of RAS 2 was completed in time, and the fish moved into RAS from RAS 1 to RAS 2 according to schedule. That was last month. The installation of RAS 3 continues on plan and will be ready for fish transfer from 2 to RAS 3 in October.
As I will mention in the other slides, you will see that activities on RAS 4, 5, 6 is in full swing. Next, please. We have always referred to the small building, and this is a close-up of the small building. To the very right, you'll see the cooling tower. A little bit further to the right, you would have seen the oxygen tank being now installed and commissioned. The small building is now completed with exterior aluminum panels and the roof ready to receive the solar panels. To the left of the building, you see some scaffolding, and that is the preparation for the installation of the glass façade for the entrance. To the very left, you'll see the entrance gate now in construction.
Maybe most importantly, in the corner of the big building, you can see that the concrete basin for the filter units are completed. The fish tanks for RAS 4 will be poured this next 2 weeks. All 4 tanks will be completed by end of August. RAS 5, today, actually this morning, the concrete was poured for the filter basin and the fish tanks for RAS 5 will be poured and completed within next month. To the left or right of the building, you see the the feed room, land room, and also the technical room for the cooling systems and the desalinization. Next picture, please. This is the picture we show in every report, the progress over the recent months.
Finally, as mentioned earlier, you can now start seeing things happening above ground. In the bottom left, we have now completed the transformer house. Installation is ongoing with the emergency generator and all the cabinets. You can also see in the orange rectangle that backfilling for phase II has commenced. Next, please. This is a little bit of the update on the actually project and production, which is what we obviously are there for. On the hatchery, it was completed on schedule in March. First egg was in late March 9, and the second in June 10. For RAS 1, also completed on schedule. First feed started in June, and batch 2 will be moved from hatchery to first feed in August.
RAS 2, also completed on schedule on time, and the fish were transferred from RAS 1 to RAS 2 in July. RAS 3, it is all the concrete work is now completed. AKVA's in full swing with the installation of process equipment. It will be ready for transfer of fish from RAS 2 to RAS 3 in October. Everything is going as planned. Thank you. Back to you, Ragnar. Oh, sorry, there was 1 more. My mistake. We continue, as we say, to build on our organization. First, the RAS team. There is a new member to the bottom right. Alejandro Millar from Chile is our Fish Health Manager, scheduled to arrive on site end of August. We have also increased the number of local farmers.
We do now have 8 local employees being trained and supervised by this. This process will continue as we now start to add new batches and move fishes into larger systems. Thank you. Back to you, Ragnar.
Thank you, Ove. Just to say a few words about the biological performance. We started in May on May 17th, National Day of Norway, start feed the fish. It has grown now up to 3g . That is a little bit better than the expectations that we had. If we look at the survival, there has been low mortality relative to our expectations. We have lost 5-6% in total. That is from eggs until 3g , and that is also better than we expected and also better than what normally goes in in batches.
We have started feeding in RAS 1, and we have now completed RAS 2, and fish have been in there since July. The next step is to move into RAS 3 in October. Then every 3 months, we will take and use one of the larger systems. If you look at the timeline of the build-out, we are now discussing stage 1. Construction start was Q3 last year, so 1 year ago. First eggs in the hatchery were in Q1 this year, meaning that in Q1 2024, the first harvest is scheduled for. That is in order to reach a steady state of 4,000 tons.
Next stage will be to include phase II, and the construction start for that is planned in Q4 next year. Then eggs can be laid in 2024. We will reach in 2026 steady state for 8,000 tons. This stage 1 and stage 2 is has always been the plan, and it is fully financed with equity. We just need an additional loan to reach up to 8,000 tons. We have discussed also the stage 3, lifting the production up to 20,000 tons. We have looking at advancing the project so that it can start simultaneously with stage 2. Stage 2 and stage 3 at the same time.
We are still looking at and planning for this to happen. If we go to start on stage 3, we will go out and have a capital increase. We have not decided yet exactly if we'll do so, or if we just will focus on stage 1 and stage 2. Ove, if you could say something about the market also.
Sure. First of all, the market for Atlantic salmon continues to, we couldn't say grow, but at least stabilize and are still good. There are restrictions, as we know, both with due to the pandemic and limited air freight. Prices remain high as we will come back to later on. The expectation is still that the market will reach 250,000 ton by 2025. There might be a little delay, as we say in the last bullet point here, because due to the COVID outbreak and the lockdown, we think that the growth have been somewhat halted, but it will pick up again. It's illustrated on this graph with the slim blue line.
It is month-by-month export of fresh Atlantic salmon to China, and the thicker one is the accumulated last 12 months export to China. The market is still good. As Ragnar mentioned in the second or third slide, we have a potential of reaching 800 million consumers. Market in that sense is something we are not concerned about. The market is there. Next one, please. Of course, market is 1 thing and price is the other thing. This is a graph which all of you should be familiar with. Before I go into the graph, I just repeat a few bullet points. The market price remains high, and we expect it to continue to be on the high side even after the pandemic restriction have eased.
As you will see from the graph, we expect a very interesting margin. The wholesale prices were 205 NOK in June this year. With our average cost per kilo of 51 NOK, it implies a very interesting margin of 154 NOK per kilo. If you look only to the relative FOB Oslo prices at 97 NOK, the margin for HOG delivered to China is as high as 108 NOK. I would like to just mention a little bit about this graph. You can see the pink one is our estimated average cost per kilo, 51 NOK. Then you have the FOB Oslo price being the thick blue one, and then the lighter blue one is FOB China prices, which are higher due to special requirements to be allowed to ship to or export to China.
The difference between the blue and the dark blue is other costs which are added to the salmon until the salmon is on the right side of the customs barrier in a cold storage, ready for the first or lower level of the market, which is the wholesalers. There is also a very interesting point here to mention, and that is that the retail prices of salmon, whether that is whole salmon or fillet, is as high as RMB 250 to RMB 300 for whole salmon and up to RMB 400 to RMB 450 for fillet. There is still a very interesting margin for those companies in China involved with processing and retail sale.
We are very optimistic to also the fact that the prices will remain high and that we will yield a very interesting margin for our product. Thank you.
Yeah. If we look at the world today, we can see that there is a very high inflation. In our project, we have fixed most of the costs related to CapEx. I want to say all of the costs related to CapEx. If you look at building first, we are leasing the building from the local authorities, and that is costs. If you look at contract we have on technology, it's also locked at a fixed cost. Even though prices in the world have increased, we still remain on the same cost level as we were when we started on the project.
If we go to production costs, operating costs, of course, we are following the development in China and the inflation has not been at the same rate in China as it has been somewhere else in the world. Feed costs are still increasing. We are still holding our costs at the same levels that we have presented before. If they continue to increase as they have done now, we will lift the production cost from our current 51 NOK to what is related to feed cost in the future. If we look at coming statements, we are still negotiating with local authorities on if we're going for this 20,000 tons, what the cost should be. It will not increase very much.
We will still have a very good and attractive agreement with the local authorities. With AKVA Group, we are looking at also next stages. There will be some additional costs related to price increase in general. We do also have an option to source smarter than we did in stage 1. It will dampen, it dampens somehow. If you look at the project milestones with the KPIs in the first stage, the main number maybe to look at for the 4,000 tons is what is the CapEx, and it still is 125 NOK per kilo. For the coming stages, we still have put in 125 NOK per kilo.
This might increase somewhat, but we will come back once we have negotiated the terms for it. Still we have set it at 125 NOK. Operating costs are 51 NOK for the phase I . If we look at how much we are thinking of producing per cubic meter of tank volume, we have set maybe a bit conservative, but at levels where production is at today in other companies, we have set the production per cubic meter live weight 227 kilo per cubic meter. That gives us 8,000 tons in production for phase II.
If we were a bit more, let's say, optimistic, and said that we could produce 150 kilo per cubic meter live weight, then we will get up close up to 10,000 tons for stage 1 and stage 2, and that would reduce the cost by utilizing fixed cost better with approximately decrease of NOK 5 per kilo. Now I'll hand over the word to our CFO, Hjalti Hvítklett, to present the financials.
Thank you, Ragnar, and good morning. We have this graph here on the right side. The lighter blue is payments for CapEx up until Q2 this year. The darker blue are payments which are coming in the coming time. You see a few high in the H2 year of this year. This is when we are receiving even more technology on site. CapEx is now up to around 50% on DKK 82 million. We have. The CapEx still remains on budget. We have a attractive lease agreement with the local government. A normal split between CapEx technology and facilities or building will be 60/40%. The main message on us is that we have.
Our scope is the 60% and the 40%, CapEx is a leasing agreement with the local government, which are building and are constructing the building for us. We have a 10 + 10-year lease agreement with fixed prices or fixed price for the lease. Profit and loss is according to our plan and our budgets. Personnel is getting higher. We are hiring more RAS people and some administration also. The financial expenses are still mainly interest or the commitment fee on the EUR 25 million loans from Eksfin. Cash flow also as planned. We have the payment for fixed assets. We are expecting to utilize the loan, the first lot of the loan in Q4 this year.
This quarter, the Q2 , we have had net change in cash of DKK 52 million. At the end, we have available liquidity for us is DKK 428 million. That is cash, DKK 204 million. We have a working capital facility in China of RMB 35 million, equivalent to DKK 37 million, and a EUR 25 million loan equivalent to DKK 186 million. Total assets are DKK 406 million, and we also have the DKK 180 million, again, the assets under construction. We have the biological assets at just about DKK 2 million. Thank you.
Thank you, Hjalti. Just say a few words about the ESG profile also. We have plans of being certified by both GLOBALG.A.P. and ASC, which are the highest standards that you can get in our industry. If we look at some of the more direct ESG items that we have been working with. Since freshwater is a scarce resource in China, we are producing our own freshwater from the sea by a very thorough cleaning process of the freshwater, so it will be of the highest quality. For renewable energy, we are producing 20% to 25% of our energy from solar panels on the roof. We will be doing so once we install them in 2024.
Close by, we have a very green power supplier with a 400 gigawatt hour solar and wind power plant that we will receive most of our energy from. From the outlets, we are cleaning the outlets very well and cleaning out sludge, which will be used as fertilizers in the neighborhood agriculture. Since we are in China, there will not be any air transport into the market, then this is the main contribution to reduce the CO2 level. We are working very closely with our neighbors, also the local government, for being a good neighbor to them. In the end, Ove, I've just given you the work again, so say something about summary and outlook.
Yes, I will say a little bit about the future. The project is, as we said, on time and budget, and we have no indication that shall not continue going further. We have transferred fish from RAS 1 to RAS 2 in July, and we will schedule and we'll do transfer into RAS 3 in October. As Ragnar mentioned, it'll continue into RAS 4 around year-end January. The biological performance remains good and fish are now 3 grams. Continue to build and strengthen the organization. The fish health manager, I mentioned, and also our focus now is to train farm operators to be in position when activity continues to increase. There is a strong development of the Chinese market, both in volume and prices, which of course is very good for our project.
We are investigating all aspects of accelerating the expansion plan to reach 20,000 tons, as Ragnar has mentioned. We hope to reach a conclusion by the end of the year, and hopefully that will end up with a solution to be in position to deliver 20,000-ton capacity by 2026. Finally, I'll just add that even if there are 18 or close to 20 months until our first sale, we are now entering into more concrete discussions with leading distributors and sellers of Atlantic salmon and possibly within China. We hope to be closer to at least have enough input to start making concrete strategies by the end of the year. It all looks good going forward. Thank you.
Thank you so much, Ove. We are now finalized the presentation, and we are ready for the questions if you receive any, Charlotte.
Thank you very much for a great presentation. We're glad to hear that everything is moving according to plan. I have not received any questions yet in the Q&A function. If anyone has any questions, you're welcome to post them in writing, and I will read them out to the management. Otherwise, I guess that everything was clear. Of course, anyone listening, if you have questions, you're welcome to contact Nordic Aqua Partners directly as well. Their contact details are in the release this morning. With that, I think I want to thank you all once again for participating here today and wish you all a great day. Thank you.
Thank you.
Thank you. Thank you very much. Thank you.