Hello, everyone, and welcome to this 2Q presentation with Nordic Aqua Partners. With us, we have CEO Ragnar Joensen, CFO Hjalti Hvítklett, and Chairman of Nordic Aqua China, Ove Nodland, who will present for us today. In case you have any questions, please write them into the Q&A function here on the Teams app, and I will read them out to management after the presentation. With that, I leave the word to you, Ragnar.
Thank you. Thank you, Charlotte. Yes, this is a second quarter of our Nordic Aqua presentation. The agenda today is, as always, we start with highlights. Then there will be a project review. Ove will come in and say also something about market. We will say something about KPIs, financials, and end with outlook summary. The very brief message today is, again, we could say that things are going as planned, in line with both time and budget. CapEx for Q2 was DKK 29 million. The biological performance are doing in line with our plans. The largest fish now has an average weight of around 900 g. We are continuing to develop the organization, and we are strengthening competence and capacity in farming.
We have also started now to our first hiring in sales. We are, we are getting closer to our first harvest. The liquidity is around in Danish kroner, DKK 475 million. This is based on cash, and then a loan from Export Finance Norway, and also some working capital in China. We are changing from being a Danish company to a Norwegian company, actually, as of today. Next time we will not report in Danish kroner, but in Norwegian. We are located south of Shanghai. The plan that we started with was to produce 4,000 tons.
We have just increased, so that in stage two, we will take the production up to 8,000 tons, we do have a plan also to reach 20,000 tons on site. If we include the neighboring site, then we, we have the option to go up to 50,000 tons on site. The current plan is firmly four plus four, so we'll go up to eight, then we also have a plan to go up to 20,000 tons. We are very proud of our own team, and both within RAS competence and from doing business in China. We feel also that we have very, very strong support from authorities and also major industrial players like Nutreco and AKVA group.
We will go to, to the project review, and, Ove, from, our, our chairman in, in, in China, please, say something about the project status.
Thank you, Ragnar. Good morning to all. I can just repeat what Ragnar just said. We continue to be on time and on budget. We finished the installation and commissioning of RAS five as scheduled. We moved the fish from four to five in May. We are now finished the installation of RAS six. We have moved the fish this month into from five to six on schedule with the construction of RAS seven, eight, and nine are finished, but we are way into now the final installation of the process equipment. That will also be done on schedule. We moved finally and completely our administration activities into the always refer to small building, as you can see up in the upper corner of the building.
For the first time, we show all of you a complete building on the roof, housing RAS four to nine, and in the very corner to the right, you can see the entrance door into our processing facility, which are now taking shape. I would also just mention that it, it looks, could look a little bit kind of messy when you see the different colors on the roof. That's simply because we haven't peeled off the protection layer, where it appears to be sort of aluminum colored. As reported before, all our roof will be installed with solar panels in, in due course. Next one, please. Again, same picture, which we are proud to show you every time we do this quarterly report.
You can see the one from April, where the concrete tanks and concrete basins were already installed. Aqua had just barely started the commissioning of Six, Seven, and Eight. Then we move to the picture on the right, again, where you see everything is under the roof. You can also see that we have now completed the main entrance, which is the asphalted road to the left of the picture, going into the main entrance. We are now ready, as Ragnar will come back to a little bit later, with stage two. That is on the inside of the orange rectangular. All backfilling and site preparation are in place, waiting for the final construction to start....
We would also mention that we have a plan now over the next month to prepare ourselves for a production and a project going on continuously. We will therefore segregate the two areas, and it will not look like a combined project and production facility. That includes greenery and, and, and proper segregation, so that's probably be the biggest change to that picture during our next report. All in all, things are going well, and as Ragnar said, we, we, we work very closely with both AKVA and the government, who continue to support us in this hectic final stages of stage one, preparing for startup of stage two. Thank you, Ragnar, back to you. Sorry, I was a bit too early. Organization, the most important part of our organization.
We are now a total of 55 employees, out of those, 11 expats. You can see the split in the bullet points. This is a picture of part of the farming team with farming manager, Ola, and Alejandro, the fish health manager. We focus, of course, very much of strengthening an organization continuously. We are very proud to, to again, be able to report that our new farming team, local team, fresh out of universities, are, are doing very, very well. The process of transferring years of experience to our local new talents are going very, very well. We also would like to mention the new senior hirings since, since last report.
Process manager from February 2023, sales manager, which was referred to, and the farming expert, which Ragnar will come back to. We have also strengthened the group accounting system with an accounting manager working with our CFO. Ragnar, back to you.
Thank you. Yeah, the RAS team is in place. We have presented this before. It's myself, and these three guys who have a lot of experience in running RAS, and Alejandro, who has come in as a fish health manager, but then Orfa Cabrera will also start. She started actually the 1st of August, and she's on base now to China, to start physically here. A lot of experience in, in producing fish in similar systems to what we have here. If we take the system, we have referred to today, that we have been transferring fish from RAS five to RAS six, I just want to illustrate also where this is. We have RAS one, two, three, four, five, and now we are moving fish from five into six.
This is the second last transfer of fish, because RAS seven and RAS eight are similar project, similar facilities. One group, the first group, will go into RAS seven, and then to harvest, and then the next group will go from RAS six into RAS eight, and then to harvest. That is the process. The next transfer is scheduled to be in November. This is the first stage in light blue, and then we will have 8,000 tons. That means that we are going to install four more systems. We call this 101 to 104, and then also some more capacity on start feeding up to smolt.
We secured the financing or the funding with NOK 300 million capital that was raised earlier this year, but it's also necessary to have a result from 2024 and 2025 included to be fully financed for stage two. We have signed agreement with AKVA group for stage two, and this agreement is not on a fixed price, it's on a target price arrangement, so it's indexed, and Hjalti will come a little bit more into that later. We have also signed a agreement with the Chinese authorities, so they will be responsible for the construction and infrastructure. Very similar to what we did in, in stage one.
The further plan to go up to 20,000 tons is also in our plans. We have not been very firm on exactly when the start should be on, on, on the 20,000 tons project. Now we have six batches at production. First batch was laid in as eggs in March last year, and they are now being transferred into from RAS five into RAS six. We just have a small video clip taken by an iPhone, but just to show you how the fish looks like when, when they're moved, and then probably the film will be running in not so smoothly. Here you can see the sizes.
The size of this fish is around 1.3 kg, and they are being size rated and then put into tanks inside of RAS six. We are counting and distributing into the respective tanks that we want to. The growth, how has the growth been? We have four batches I will show you the results from. In this first slide, you can see batch one and two. Batch one, we are, we cooled down the water in November and December, January. We lost a little bit of weight there, but we have gained some of this back. We are, at the moment, around three weeks behind schedule, two-three weeks behind schedule.
In all other batches, we are from one up to six, seven weeks ahead of schedule. All in all, we can say that fish are growing very much according to schedule. The survival in all batches has also been very good, also in Q2. Here you can see batch three and batch four. Here we are around these six to seven weeks ahead of schedule in the production. The first batch is lagging a little bit behind, but it's caught up more than that with the batches right behind it. As you can see from batch one, the average weight is now around 900 g. Second is 400 g, and then it's 160 g, and then 35 g.
We started to put fish in Q1 for stage one. We started Q1 in 2022. We will harvest the first fish, we have set all this in Q1 2024. It will be in March that is scheduled, and if it'll be March or April, it'll, it'll be in this area. We think that it will be in March. For stage two, we will start to lay egg, the first eggs in Q1 this next year, then it will take 24 months until we can harvest. For the 20,000 tons project, we say that we have said that the earliest start we could have was middle of next year. That is still the case. We have not decided yet whether we will start exactly on that.
We are, we are working on to getting the funding finally in place and so on for this one. We will come back to that later, let's say, the exact timing. Ove, if you could say something about the market also, please.
Yes. The growth and, and market for Atlantic salmon in China continues to growth. We've seen a tremendous growth from previous year, 2022 into 2023. Total import of fresh Atlantic salmon as per Chinese Customs for first half was approximately 45,000 tons out of Norway, which Norway had about 44% or close to 20,000 tons. You can see the, the split of, of various countries on these pictures, and a nice picture to the right of, of, of our salmon. We expect, or the market expect the, the growth in second half to continue, which means that the total market volume in 2023 is expected to be somewhere between 95,000-100,000 tons.
On the next slide, I will talk a little bit about the Norwegian picture, and only if you could change. As we already mentioned, the market is continued to growth. This is just a breakdown on the price structure for the Norwegian part of the export. The bottom, the dark blue, is the same graph that we refer to at all time. It's the FOB Oslo to any other country but China. We have the thick orange, which is FOB Oslo for destination China, and as you can see, it represent a few elements. One is that China mostly buy large fish. There is also a requirement for special packaging and a limited, limited number of approved processing plants to export to China.
That's the basic explanation to that significant gap between FOB Oslo, FOB Oslo to China. Then, the difference to the blue one is the freight cost, air freight cost. Then on top, we have the cost to get the imported salmon through customs clearance and into a cold storage area on the, should I say, right side of the custom barrier, including 7% import tax and handling fee of region of NOK 3, which bring the total up to somewhere like NOK 175 per kilo. I think that should explain what we have indicated throughout the entire project, that the market is hugely growing, and that we are very well positioned to, to take our share of that market at favorable margins. Back to you, Ragnar. You are muted.
Thank you very much. We'll just go through the table of some KPIs or economics in the project also. We have presented this before, and it's unchanged. Stage one, 4,000 tons; Stage two, 8,000; and Stage one, two, and three, that will be 20,000 tons. The CapEx costs, where they will be around. I should just mention, when we mention Norwegian kroner, none of the, of the costs we have are in Norwegian kroner. This is just from our currencies switched into Norwegian, and mostly for the CapEx, it's euro, and we have used the euro exchange rate of one to 10 between euro and Norwegian kroner here.
There will be a slight increase in the cost as the years has passed by, and there's been some inflation. The lease cost is actually going down because we are adding less square meters per produced volume. The costs are still in line with what we have presented for, but of course, if we took the currency of today, the Norwegian kroner, would be a bit higher than the 10 that we have assumed in our setup here. If we, I mentioned this before, that we have assumed also certain production capacity within our site. We say that we can produce 127 kg per cubic meter of water or tank water we have.
That gives us 8,000 tons for stage two. If we are able to grow the fish faster, or just to produce more from our site, then, of course, the volumes will go up, and also the cost will be reduced. That's in the nature of it. We have been, as we think, okay, careful with at how much we expect to produce from, from the facility. Now we'll go to the financials, and they will be presented by our CFO.
Thank you, Ragnar. Yeah, before entering the financial figures, just briefly on the agreements we have. Our usual split between technology and facility is 60/40. As Ragnar explained earlier, the variable lease agreement we have with the local government corresponds to NOK 40-45 per plant production kilo. With adding the RAS equipment, we will reach close to NOK 175 per kilo. As Ragnar explained also, we had a fixed price agreement with AKVA for stage two. The contract is based on target price agreement, but based on our experience from stage one and also the calculated buffers, and the likelihood that we should exceed the target price are limited. Next slide.
Key figures, financial performance is in line with plan and budget. There's one number that stands out, that's ex... the fin- financial expenses. I will come back to that on the next slide. We are still mainly financed by equity, with an equity ratio around 80%. Take the next slide. As I said, this is in line with our plan and budget. We are, of course, increasing the external expenses and the staff cost as production is increasing. That's natural. The financial expenses are on DKK 18 million. This is...
We have EUR 2 million from expenses from loan and also financial income from cash, around EUR 1.5 million. The rest is the EUR 18 million, a non-cash deviation from the Chinese subsidiary. The Chinese subsidiary is financed by registered capital from the mother company, and also an intercompany loan on EUR 25 million. As the exchange rate fluctuates between local Chinese currency and euros, we have a loss on the exchange rate on the loan, on the intercompany loan, and also on the Eksfin loan. These, these are non-cash deviations. Apart from the extraordinary or the financial expenses on the exchange deviation, we are in line with our, our budget. Next slide.
Total assets have increased, it's mainly from the capital increase we had earlier this year. We of course see an increase in the property, plant equipment or assets under construction, which has increased to a total non-current assets on DKK 357 million. That is included also on DKK 9 million in deposit. Biomass has now reached DKK 16 million, and it's equivalent to 210 tons as of June. We have secured funding for stage two through our DKK 300 million capital increase, we also have to include the results for 2024 and 2025. Next slide. Cash flow, same story. It is according to our plan and budget, we can...
The main figures are the capital increase and the first drawdown of the loan from Eksfin, and we are still remaining a loan from Eksfin later this year. Thank you. I think that was my last slide.
Thank you, Hjalti. We will just continue. Just a few words about some of our ESG profile also. As we have mentioned before, we are producing our own freshwater since freshwater is a scarce resource in China, so we're producing it from the sea. We are establishing solar panels on the roof, as Ove mentioned also. That will be done once we are finished with the building of stage one. Covering the roof of stage one will assist us with 20%-25% of the energy, and the rest of the energy is arriving from a very big wind and solar panel power plant here on the island of Gaotang Island in China.
We are going to collect all the sludge and send that into, we are trying to get the finalized agreement with the biogas plant so they can use it, their waste into fertilizers, into the local farming area around here. We are not, of course, since we are producing in China, we are not flying fish anywhere else. China is our market, and we're continuously trying to improve the relationship we have, both with our neighbors, but especially also with our local government. Just to sum up, the project is still in line with the postal time and on budget. We are moving fish according to plan. The growth rates and performance and qualities are in line with the expectations also. We are building up the organization.
Market looks still interesting, even though prices have dropped a little bit, it's still very interesting. We are continuing with our plans for first on stage two to get 8,000 tons, then we'll come back with plans to progress further into 20,000 tons. This completes our presentation. Thank you for listening.
Thank you very much, Ragnar, and the team for a great presentation. I can't see that there has come any questions in until now. If you have any questions, anyone on the line, you're free to contact Hjalti and the team with your questions later to receive a written answer. You can reach Hjalti at hjalti@nordicaquapartners.com. Thank you very much, Ragnar, Hjalti, and Ove, and I wish you all to have a great day.
Thank you. Thank you to all.
Thank you.
Thank you.
Thank you. Bye-bye.