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Global Aquaculture: Australia’s Role in Meeting Industry Challenges

This article was published on the Future Directions International website here

It was written by Matthew Curry, Research Assistant, Global Food and Water Crisis Research Programme


Global Aquaculture: Australia’s Role in Meeting Industry Challenges

Wednesday, 27 August 2014

Aquaculture is rapidly expanding and showing promise as a means of decreasing poverty rates and improving food security globally. Australia’s world-leading aquaculture companies have demonstrated their potential to pioneer the advancement of this important industry.


Aquaculture – the breeding and harvesting of aquatic organisms – has grown substantially in recent decades. Despite this, long-term mismanagement of the world’s fisheries has led to a decline in world fish stocks, placing increased pressure on aquaculture to meet global demand. Fish consumption has been linked to improved nutrition and poverty alleviation; thus, sustainably managing this expansion is essential. 


Seafood Intelligence – an independent international seafood market news and information service – has benchmarked Tasmanian salmon producer Tassal as the world’s top salmon farming company, based on corporate, social and environmental responsibility and sustainability. This report was accompanied by an Australian first: Aquaculture Stewardship Council (ASC) accreditation for Tassal’s Macquarie Harbour farms. The award comes at a time of global growth in aquaculture, which is increasing the availability of fish as a safe and healthy food option.

Aquatic produce is a source of income and food security for more than 500 million people in developing states. Fish is high in protein and essential oils: vital components of a balanced diet. Low incomes restrict many people from accessing such essential sources of protein, however. Therefore aquaculture’s capacity to provide a source of protein and income for those living in poverty is invaluable to developing populations. That potential is complicated, however, by inherent sustainability issues.

Aquaculture, if poorly managed, can contribute to widespread environmental degradation. This includes reduced water quality, stock disease and damage to ocean ecosystems due to fish feed extraction. All of these negative effects must be addressed to ensure the successful expansion of aquaculture.

Although Australian aquaculture accounts for just 0.36% of global production, the high quality and sustainability of Australian products and production systems have made Australia an industry leader worldwide.

Developing alternative feed sources is vital to the expansion of agriculture. The Australian government and aquaculture industry leaders can assist in this area, through research and resource provisions. Aquaculture cultivates high value fish that are often carnivorous; they are fed smaller and lower value fish extracted from the oceans. This, however, can upset the ecosystems and food chains in the oceans. The Australian government is currently investing in a joint aquaculture research programme with Vietnam, to find alternative, sustainable feed sources. Solving this problem will require co-operation between all stakeholders, i.e. governments, policy makers, commercial farmers, smallholder farmers and subsistence farmers around the world. Programmes such as these are a step in the right direction for the industry’s future.

In developing countries, many aquaculture enterprises are only designed for subsistence farming. The strict food, health and safety standards required for exports, often bar smallholder farmers from gaining access to global markets, which limits their potential to improve their livelihoods. Australia’s extensive knowledge and expertise in health and safety standardisation could be applied to help develop these smallholder farms.

Aquaculture will continue to expand as the demand for fish increases; however, that growth will need to be sustainable. This is essential to uphold aquaculture’s promise in addressing food insecurity and poverty issues. Australia has the potential to contribute significantly to the sustainable development of global aquaculture, by assisting smallholder farmers in developing nations who lack the systems, skills and technology to gain broader market access. The collaboration of Australian firms with other countries and stakeholders can assist in achieving greater food security globally.




"The absence of evidence is not evidence of absence".

We’ve copped a bit of flack from a few people in the salmon farming industry because we’ve made a bit of noise via Twitter about the false PR being distributed, which claims that ISA has been proven to not be present in BC salmon wild stocks.

To clarify things:

Aquanue supports sustainable, clean aquaculture in any format, anywhere.  

And we're certainly not being critical of the families and companies that farm salmon.

Far from it - we're on their side!

What we're concerned about is the incomplete story being promoted that suggests the ISA tests were all negative, when, by the authorities own admissions, the samples were too degraded for the tests to be conclusive.

We're as worried on behalf of the salmon farmers about the lack of reliable testing as they should be, and as they are about the damage done to their industry by negative PR, or worse, by a possible outbreak of ISA.

We don’t believe it is relevant if the original samples came from ‘activists’, as has been claimed.  If samples of salmon have been presented that contain ISA, it doesn’t matter who found them.

If the original positive tests found ISA that had been placed there maliciously, as has been claimed, then this is a dirty tactic and it should be exposed.

But if the same samples were so degraded that the second round of tests were deemed “inconclusive”, as the testers explained at the press conference, there needs to be more testing.

Dr. Con Kiley, Director of National Aquatic Animal Health with The Canadian Food Inspection Agency (CFIA), stated that the findings “must be considered inconclusive”.  Peter King, of the Fisheries and Oceans Canada (DFO) Moncton laboratory, stressed that they received the samples in either a partially degraded or totally degraded state. Given that, he noted “That’s why we call things inconclusive – because the degradation is so bad you can’t form an opinion….”

Everyone involved should be demanding that new, fresh samples should be tested immediately.  That ‘everyone’ should include the salmon farming industry at the top of the list. They stand to lose the most if ISA is actually present!

If ISA is present in BC waters, and if it came from the farms, then the whole salmon farming community should want to know – they should be clambering to find out if it is there and where it came from.  Finger-pointing is not the objective, but finding the source is a major part of stopping it from happening again – if ISA is actually present.

Aquanue promotes closed recirculating aquaculture because we believe it is more efficient, lower risk, and does less environmental damage than other systems.  But that is irrelevant.  What we believe in more strongly is factual truth in PR, in not telling only that half of the story that suits, and in not hiding behind misleading spin.

We’re not being critical of salmon farmers in any way – although we would be if they introduced ISA into wild stocks.  We’re the first to agree that this hasn’t been proven – because nobody knows if ISA is present or not!

If the salmon farming industry didn’t introduce ISA into wild salmon populations, it has nothing to worry about – other than the clear fact that until thorough testing of new, fresh samples from a broad cross-section of wild stock has been completed and ISA is not found, nobody can say for sure that it is not present.

Inconclusive tests, on samples so degraded that they would miss ISA if it was there, don’t provide the answer.

"The absence of evidence is not evidence of absence".

Wouldn’t you want to know for sure if fish swimming past your salmon pens were infected?


The benefits of an independent feasibility study

Continuing with our discussions on the investability of aquaculture, I’ve had an article on feasibility studies contributed by Donald Safranek, President, Wert-Berater, Inc.

Having an independent analysis and report prepared on the commercial feasibility if prudent in the case of ANY commercial venture.  Given the knowledge gap between aquapreneurs and investors – having someone independent conduct a feasibility study on a proposed aquaculture project seems to me to be a no-brainer. 

Donald’s firm has plenty of experience in undertaking studies in the aquaculture space, as his article shows.

Donald writes:

“In my 20 plus years of working as a professional economist and growing a company that provides feasibility studies for all types of projects on a global basis, I have yet to listen to a project owner/developer who told me their project would not work.

However, my firm has produced thousands of studies over the years and hundreds of those projects would not work and thus were not feasible for different reasons.

What I have learned is that experience and intuition is not enough.  Prime example is Las Vegas, Nevada and the housing boom that took place from 2004 to 2006.  Over this period of time the word “feasibility study” was never even uttered in the halls of real estate developer land.

Projects were being sold out before the developer could turn the key on his new Bentley.  For many of those same developers that Bentley was long ago repossessed.  So many of those money makers lost their bets.

In the world of the fast changing and growing demand for aquaculture there are many of the same principles at play.  I speak to developers of would be shrimp farms, mollusk farms and fish farms all citing the same facts about demand and how each country must become independent for its food sources if not for balance of trade issues, then for security.

Many of these developers I speak to are well trained and gifted scientists who speak so far over my head about their new project is that my eyes glaze over as their voice projects how successful their project will be because their survival rate, disease mitigation and systems are the best that man has ever dreamed.

Not often these project developers ever mention who they will sell their products to or how they will market them, or how the product will be delivered to market or if their operation is wholesale to Cisco or retail to white table cloth restaurants.  Rarely do they mention if there is a supply of labour in terms of local scientists who are willing to work in such a risky start up, or if the site they have chosen allows for such development from a legally permissible or physically possible aspect.

Often when a pro forma is presented, it is what I like to call “horizontal” presenting the gross revenues, minus the expenses and nothing but riches at the bottom of the page.  There is rarely a linear analysis that shows start time and cost, or month to month seasonality, or even a Monte Carlo Simulation that helps us to understand the probability of that large projected net operating income if supply chains are disrupted or if prices change or even if there is a malfunction in a technical system at the new plant.

Risk is often overlooked.  The developers often present a low, medium and high in their analysis, yet not much else is presented in terms of risk.   Most shun the idea that an unbiased third party should be paid such a high fee to tell them how great their project is and how dare anyone question the viability of the project.

The questions to ask are many in the proper feasibility study.  I was told by a developer of a $20 million project that they found someone to provide a feasibility study for $1,000 in about 2 weeks’ time.  I hung up the phone thinking of the last words spoken by Marlon Brando in Apocalypse Now "The horror ... the horror”

Contributed by Donald Safranek, President, Wert-Berater, Inc.

Wert-Berater, Inc. is a diversified consulting firm providing services to its clients on a global basis, operating from 18 offices in five countries with a staff of over 1,000 professionals. The company acts as a consortium for its alliance partners to provide economic, market, financial, management, and technical studies such as feasibility studies, technical assistance, highest and best use studies, and market studies.

Through its alliance membership, Wert-Berater, Inc. is able to provide studies, technical assistance and third party consulting services with a vast number sectors and project types including agriculture, aquaculture, aquatics, aviation, energy, hydroculture, medical facility development, infrastructure, real estate, recreation, and transportation globally.


Offshore vs Closed Recirculating Aquaculture

On the topic of offshore vs closed recirculating systems, we’ve had some great discussion in the ‘Aquaculture Means Business’ group on LinkedIn.

The comments I’ve made being a bit critical of open water production were aimed more at sea cage systems that operate within a stone’s throw of the coastline, and as a closed recirc guy I’m concerned about the risks of operating open water systems, and potential for environmental damage at whatever scale. But offshore advocates are concerned about capital costs and the use of land for tank systems that could have been used for housing or cropping.

I’m right, and they are right.

The fact remains: “The United Nation’s Food and Agriculture Organization (FAO) has projected that by 2030 an additional 37 million tones of fish per year will be required to supply global demand. Focusing on aquaculture, the FAO has projected that in order to maintain the current level of per capita consumption, global aquaculture production will need to reach 80 million tonnes by 2050. Due to the inability to increase supply from wild capture sources, the only feasible source is aquaculture. But Aquaculture can only fill this gap if it is promoted and managed in a responsible fashion.”

Closed recirculating systems and offshore production need to do more than co-exist, they need to collaborate if we have any hope of feeding the population numbers we reached this weekend. 7 billion is a big number, and too many people are hungry. At a net population growth rate of 200,000 new people every day, the problem is not going to solve itself!

Closed recirc systems can grow the seed stock for offshore systems, and grow the fish that don’t typically live in open water. Offshore systems can grow the fish that like the open water and that sell in much higher volumes but not at the luxury prices of some rarer species.

As I posted on the Aquaculture Means Business blog, http://aquaculturebiz.wordpress.com/, run by Jeff Dunsavge:  "For me, the risks and ongoing costs, and the footprint, of open water production, compared with the level of control and ability to manage inputs and outputs offered  by closed RAS systems, make closed systems a far more bankable and attractive solution."

There are no simple solutions to the ‘coming famine’ as Julian Cribb calls it, but closed recirculating and offshore aquaculture systems are two of the most likely key players in the complex solution required to feed the world.

There is a far bigger issue at play here than pushing our own commercial barrows – we have a hungry world to feed!!

And if we're not going to be part of the solution, we remain part of the problem.