A new "import-driven" production model, used by fishing group Oceana to overcome a shortage of local pilchards, is paying off. The plan, initially aimed at stopping a serious profit dent at its best-selling Lucky Star canned fish brand, is proving to be a winner in its own right. With the local total allowable catch for pilchards well below what is needed for commercial production for canned fish, Oceana has increasingly taken to securing supply from outside SA waters. At an investment presentation last week Oceana CEO Imraan Soomra said 96% of Lucky Star’s pilchards now come from elsewhere in the world, with key sources being Mauritania and Morocco.

Naturally, this has raised concerns around additional production costs — especially if the rand weakens. Oceana’s working capital cycle is now also skewed to the first half of the year when the group procures the bulk of its pilchard stock.To make matters worse, Lucky Star scraps for market share in the highly competitive "afforda...

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