A company set up to farm mussel beds gifted to a Highland village four centuries ago by King James VI of Scotland is under threat of closure.
Highland Fresh Mussels was launched 14 years ago to harvest shellfish in the Dornoch Firth, with profits going to Tain’s Common Good Fund.
But the local authority-run business, while raising around £1million for the community, has recently been making losses and its future is now in doubt.
Blame has been put on a poorer quality of mussel, reduced demand in the face of strong competition and a recent outbreak of algae.
The beds were originally gifted to the Royal Burgh of Tain by King James VI of Scotland in 1612.
Highland Council took over the running of Highland Fresh Mussels in October 2011 - just a year short of the Royal gift’s 400th anniversary.
A report to the planning, environment and development committee, which meets on Wednesday, states: “Since taking over the fishing operation on 1 October 2011, market conditions have remained very difficult.
“At the time of writing only 63.52 tonnes of mussels have been sold and demand remains very low in the face of strong competition.
“A further blow to the operation has been the 12 week closure of the fishery as a result of algal toxin levels within mussel stocks.
“The future of the operation is now called into question.”
The mussel beds in the Dornoch Firth belonged to the Crown up until 1612, when ownership and the right to fish for them was bequeathed to the Royal Burgh of Tain in perpetuity by James VI of Scotland.
The fishery forms part of the Common Good of the old royal burgh area and was once operated by Cromarty and District Community Council before the local authority took control.
It was then re-launched as Highland Fresh Mussels which began trading in 1998 with four directors - three Highland councillors and a representative of the local community within the Royal Burgh.
Since then, it has contributed more than £1million to Tain Common Good Fund.
But in recent years, the quality of the mussels have fallen - and 2010’s landings 211 tonnes were the lowest on record.
The falling sales and profits had prompted the directors to hand back the fishery to former operators Highland Council.