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LETTER: The US aquaculture is lacking support, investment and a success story

The industry is plagued by a lack of support and leadership

The following letter was sent to IntraFish by aquaculture industry consultant Joe McElwee in response to the column by Editor John Fiorillo, The US aquaculture industry is on life support.

I read your article recently, and whilst you do hit a number of important points, unfortunately you have said absolutely nothing new that we in the industry don't already know, or are completely frustrated by.

As a European (Irishman) who has been involved in the aquaculture industry in the USA since the early 1990s, when I guest lectured here at various conferences it became very, very apparent to me that the USA was missing the following:

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1. There is absolutely no government financial incentive support (like the EU programs), barring some token grant aid here and there, and this mostly goes to the academic institutions and not in the amounts the commercial side of the industry requires, and actually proves the ideas through practical concepts. I can tell you for a fact, growing fish in trial academic conditions, is nowhere near growing the fish under stringent commercial result-driven protocols and KPI’s.

2. To me, there has, or is, no real aquaculture lobbying group fighting in our industry's corner, like the beef, poultry and, chicken industries. Therefore, we are so far down the political drainpipe we don’t even come out the bottom spout. I am still incensed we, or the government officials in the respective departments, have not yet, after 10-plus years, approved an organic standard for our industry. We have to mislead our consumers by attaching/associating/stealing the Canadian or European standard.

I was intrinsically involved in the set up of the Irish organic standard and subsequent application back in the 1990s, as it was one of the few options left to the Irish industry for maintaining its position in the premium-price salmon market, as the Scots and Norwegians were vastly and quickly expanding due to improved systems and pricing/demand of the product. It no doubt has saved our small industry, which produces less than 15,000 tons but is still a highly prized product on the market, and subsequently followed by all other countries (except the USA).

3. The investment community here still does not understand the industry properly, both from a funding and operational view. Figures look great on paper, and we can all grow profitable numbers of Excel [spreadsheet] fish, but in reality we’re missing, experienced operational senior management, proper funding and incentive sources and a relative and respective PR machine promoting the industry.

Instead of depending on health-related NGOs supporting the industry, such as FAO or WHO, we need the likes of the US Surgeon General, educational boards and local health authorities supporting the products, there health benefits and, of course by association, the species and availability. Throw in sustainability, locally grown and carbon footprint, and you have the perfect recipe for product education and, subsequently, demand.

I have attended a number of IntraFish forums and they are vital, excellent and necessary. I was invited to speak at one in London two years ago, and I received a number of inquiries from investments groups after the event, based on my impartiality and honesty in discussing the topics being presented.

It’s more forums like this that we need. They should be centered on US state regulators to demonstrate to them the cost and effort needed and required to develop the industry. In addition, the forums would be helpful to state or local investment groups who can pull together or have access to investors/financing in the various localities in the state.

Having been involved in a number of large potential projects and some that are now operational, I can tell you that the potential entrant will need at least $2 million in seed capital and up to two years just to get all permits and site, assuming there are absolutely no impediments from any source. And then they build. So there’s going to a be a significant financial commitment and outlay, and then if all is going well you start harvesting your fish at five years from the day you first paid out. That’s a hell of a long time for any financial commitment.

4. We need a success story at a proper commercial level for whatever species we’re dealing with -- salmon being the current favorite. The figures need to be transparent and practical. Just stating we’ll ramp up to X thousands of tons, from a paltry couple of hundred is not the way to prove the industry, finances or future investment potential. It's about being realistic in what we can do and produce. To my knowledge, and I do stand to be corrected here, no one has produced in excess of 2,000 tons per calendar year (financial year), of RAS salmon. So why do we suddenly think we can jump this gigantic financial and environmental physical barrier? We’ve stepped it up slowly in the marine sites from the early 1980s of 25-ton cage production to the current offshore Norwegian 10,000-ton cage units, which by the way are still unproven, but appear to be viable.

5. Education of the masses, both investors and consumers -- a daunting task in itself -- needs to be spearheaded with direction and facts.

Anyway, just a few thoughts from a fish farmer.

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