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Aquaculture Investment Workshop 2015 blog: Recap on all the news here

IntraFish's Avani Nadkarni is blogging live from the US Soybean Export Council's fourth Aquaculture Investment Workshop at the University of Miami, where a group of about 80 of the industry's leaders are gathering to learn and network.

Thursday, April 30, 2 pm EST

An industry of collaboration

As the conference comes to a close, the overarching theme of the workshop -- and of the aquaculture industry as a whole -- is collaboration.

As longtime experts of the fish farming industry gathered to share advice and expertise with those just starting, or those looking to invest in the industry, USSEC's Fransisco de la Torre closed out the workshop with these words: "That's really going to help the industry move forward."

-- Avani Nadkarni

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Thursday, April 30, 1.15 pm EST

Insuring the fish

Aquaculture Insurance Exchange's Todd Blacher and Ben Meskin spoke on the importance of insuring fish farms and sites, something Blacher said many aquaculture companies don't think of doing.

It can be tricky because underwriters are often leery of insuring newer or unfamiliar species -- as of now, salmon, sea bass and bream, tilapia, trout, tuna, cobia, abalone, oysters, sea cucumber, sea urchin, scallops, mussels, shrimp, prawn, crabs and sturgeon are all insurable, Blacher explained.

Also, underwriters are more accepting of offshore farms because "it's very transparent," he said. "A net pen is a little bit more transparent [than RAS farms or pond-based farms] so the underwriters are a bit more comfortable for that reason."

"Insurable risks" for offshore farms include pollution, plankton bloom, theft, predators, relevant natural disasters such as tsunami, equipment failure and "the big one," disease. For onshore farms -- RAS, ponds, raceways, fiberglass or concrete tanks, some insurable risks differ: Floods, drought, fire, explosions, unforeseen issues with water supply, frost damage, accidental infrastructure damage and electrical supply failures are included.

Meskin spoke on the two types of insurance: the "all risks" policy that covers any risks of mortality unless specifically excluded and the "named perils" policy that only covers specifically-named risks. The latter is often "found in cases where the country or the farming techniques or the species are not as familiar to the underwriters," Meskin said.

-- Avani Nadkarni

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Thursday, April 30, 12.30 pm EST

Don't just pay lowest price, pay lowest price for what you want

The retail seafood business may look bleak in the United States -- Alfa Gamma Seafood's Phil Walsh said of all the dollars spent at American grocery stores, only 1.8 percent is spent in seafood. In addition, a whopping 75 percent of seafood consumed in the US is at restaurants.

But Walsh says that just means there's a huge opportunity for companies such as Alfa Gamma. A good retailer to take heed from, he said, is Costco, an Alfa Gamma customer.

"Of all the people we sell, Costco sets the bar on how to do it. They don't just want to pay the lowest price, they want to pay the lowest price for what they want, which is the highest quality. These customers make you a better supplier."

-- Avani Nadkarni

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Thursday, April 30, 11.15 am EST

'We're quite certain of the future'

Rex Ito, head of Prime Time Seafood in Los Angeles, said his farmed tuna sales recently surpassed wild-caught tuna and he expects that in a few years time, sales of Prime Time's farmed seabass "is probably going to double the sales of our tuna combined."

Aquaculture, "I know, that's the future," he said.

Prime Time sells mainly to sushi bars and white tablecloth restaurants in Southern California and says his customers look for "quality, consistency and price, and I would say it's in that order."

"There's no way to sugarcoat the difficulty of selling a lot of fish at a high price," Ito explained. "You'll get all this interest all the time from CEOs of companies who say 'We want sustainability' ... but then you may get one or two orders for the curiosity factor. If you don't provide an excellent product and value where everyone in the chain makes money, you wont get anywhere."

-- Avani Nadkarni

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Thursday, April 30, 10.40 am EST

Costco: 'Aquaculture will always be a big part' of company

Adam Matkin, buyer at Costco -- which earned $11.2 billion in fiscal year 2014 -- said "aquaculture is, and will always be, a big part of" the retail giant.

He also said any fish farmers wanting to do business with the global empire must define the quality of their products "quantifiably." Costco measures quality on things like marketplace uniqueness, time and temperature, the social investment of the farmers, food safety issue and environmental quality.

In response to audience questions, Matkin also mentioned that "there's really not a minimum size" of farmer the company will do business with. "We're willing to talk to anybody. We just don't want to be a big part of somebody's business -- we don't want to put a company under because of something that happened to us."

In addition, while he deals with frozen seafood not fresh, he said the $1 reduction in Costco's fresh tilapia pricing -- from $5.99 to $4.99 -- "was very impactful. Yes, it did impact sales in a big way."

-- Avani Nadkarni

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Thursday, April 30, 9.45 am EST

Probiotics in fish

Ecomicrobials CEO Philippe Douillet spoke on the benefits of probiotics for farmed fish.

As opposed to "detrimental bacteria," which thrive in polluted waters and lead to stress, disease and, ultimately, mortality, "beneficial bacteria recycle aquaculture waste into the food web," Douillet said. "Yet there are very few attempts to control the nature of the microbes in the system."

There have been several experiments showing the benefits of giving probiotics to farmed fish, he said, particularly trials done at Aquaprimavera in Colombia, which farms mainly tilapia. Utilizing probiotics in the farm, the company experienced a more than $6,000 benefit, a 33 percent lower FCR and a cost of feed decrease of $208.

"The total cost of production was much cheaper," Douillet explained. Other benefits at Aquaprimavera included a shorter length in the growth cycle and healthier shrimp with solid shells and better color.

-- Avani Nadkarni

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Thursday, April 30, 9.10 am EST

About the soy

US soy isn't going anywhere, said USSEC CEO Jim Sutter when he addressed the attendees. In fact, soy yield has increased 1.5 per year for many years in a row.

"It will continue and it could accelerate with all of the things being done with breeding," Sutter said "I believe US soy farmers will continue to respond to demand and there will be continued increases in production."

A couple of years ago, due to poor weather, price of soy rose, but Sutter assured attendees that is no longer the case.

"We've had record production in the US, very strong production in South America -- a record in Argentina -- and prices have come down again," he said. "There will be an increase in raw materials for your business."

There are 34 million hectares of soybeans being farmed in the US and even as yield is increasing, the land dedicated to soybean farming is not. Ninety-five percent of US soybean hectares participate in the US Department of Agriculture (USDA) conservation programs which include annual certification.

-- Avani Nadkarni

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Wednesday, April 29, 2.45 pm EST

Turkish powerhouse expands globally

Turkey shouldn't be counted out of the aquaculture game -- and Kilic is it's biggest player.

With 42,000 metric tons of total capacity, the company produces 50 percent of the country's total seabream, 30 percent of total seabass and has a whopping 70 percent of the total juvenile capacity in Turkey with 394 million metric tons.

And Kilic is not resting on its laurels. While Hayri Deniz said currently the core business is sea bass and bream "complemented by" trout and bluefin tuna, it is working on diversifying the species and creating a selective breeding program.

Kilic recently purchased a bluefin tuna farm with a total capacity of 1,840 metric tons and is starting a mussel farm this year, along with beginning to produce organic bass and bream.

Finally, it is planning to expand out of Turkey, including into Morocco and Albania for the EU market and the Bahamas for the US market.                                              

-- Avani Nadkarni

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Wednesday, April 29, 2.30 pm EST

The fish in Turkey

Don't count Turkey out of the aquaculture game, said Kilic Seafood's Hayri Deniz.

The country has the second-longest coastline in the Mediterranean, after Spain, and houses 26 million hectares of water available for aquaculture. The necessary laws -- fisheries laws, environmental laws, aquaculture regulations -- are in place for those looking to start new fish farms there, too, he added.

The country is no shrinking violet when it comes to aquaculture -- in 2013, it produced 607,515 metric tons of seafood and while aquaculture was just 38 percent of that in volume, it was 58 percent of the total value.

The country produces trout and carp inland and sea bream and bass offshore in its more than 2,000 fish farms "our sector is growing very fast every year," Deniz said.

It produces 40 percent of the world's sea bass production and is second following only Greece by producing 25 percent of the world's sea bream production. Turkey grows 50 percent of European trout production and 25,000 people are employed in the Turkish sector.

Still, Deniz said it's been a struggle convincing the country's own people to eat it.

"Unfortunately, Turkish people prefer to eat meat instead of fish," he said. "We're trying to change [that]."

-- Avani Nadkarni

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Wednesday, April 29, 12.25 pm EST

The seafood 'F word'

Neil Sims, co-founder of Kampachi Farms, is a longtime member and passionate proponent of the North American aquaculture industry -- and he thinks the bad rap it gets in the United States is finally fading.

Science that's come up in the past decade -- and particularly the past few years -- "that gives us the ammunition to ... refute the fearmongering" produced by some NGOs and other groups, Sims said.

Even fishermen in Kona, Hawaii, where Kampachi Farms is based "now get it," he said.

"They love us there, they said 'This is the best fishing we've ever had in our lives,'" Sims said. "[The cages] act as a giant fish aggregating device."

Yes, US regulations can be lengthy and tough but "the worst is this -- the persistent perception that aquaculture is scary," Sims said. "The F-word, farmed fish, is considered a dirty word."

Kampachi Farms relocated its production site to La Paz, Mexico, recently and has broodstock that's already spawning 15 million eggs per month -- and the US government can learn from Mexico's, he believes. The company will maintain its R&D facilities in Kona, Hawaii.

"Mexico is a country where the government deeply appreciates the need for aquaculture," he said, adding that a one-year research permit is fairly easy to obtain. "It's a beautiful system there."
 

-- Avani Nadkarni

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Wednesday, April 29, 11.05 am EST

How Ecuador marketed its 'First Class Shrimp'

In late 2012, Ecuador's Camara Nacional de Acuacultura (National Chamber of Aquaculture) began working on a domestic communications strategy "based on tangible things, like benefits, why was it relevant to have a strong shrimp industry in the country," said the group's Jose Antonio Camposano.

Ecuador has more than 200,000 hectares dedicated to shrimp farming and produced 657 million pounds of shrimp in 2014.

It's the top shrimp exporter to the European Union (EU) and number three to the US behind powerhouses India and Indonesia. And, Camposano said, "growing businesses are usually targeted as 'bad businesses'" unless something is done to change that, so the chamber decided to get to work.

So, the nation launched the "Best Shrimp in the World" campaign, later changed to Ecuador: First Class Shrimp."

They hammered the idea that while the Ecuadorian shrimp farming industry is growing quickly, it's also doing it sustainably by adding the tagline "In production since 1969 and still growing": "If we're doing something in a bad way, how are we still producing shrimp for 45 years," he pointed out.

Even though it was a domestic campaign, they launched an English-language site and a Twitter account and launched the campaign at Seafood Expo North America in Boston and Seafood Expo Global in Brussels this year.

"I want to invite you to ask the same question," he said to the gathered attendees. "How can we communicate in a way to have our consumers ask for [aquaculture products] and not be afraid of it?"

-- Avani Nadkarni

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Wednesday, April 29, 10.25 am EST

Farming in rural communities is a two-way street

Fish Farming International's 2014 Person of the Year, Regal Spring's Magdalena Lamprechts Wallhoff  spoke on building a successful social infrastructure within the communities where fish farms are and said the onus is not all on the employer to provide jobs to anyone regardless of experience or behavior -- but it is also not all on the communities to work on the farms without expectations, either.

"You can get all the equipment in the world, but the people, if you don't manage them well and they don't understand where you're going, it won't work," she said. "Wages have to be fair and they have to be timely."

For more on Wallhoff and Regal Springs' social investment work, read here.

-- Avani Nadkarni

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Wednesday, April 29, 10.10 am EST

The four aspects of aquaculture

"Opportunistic investor" and nine-month-old firm Pontos Aqua is focused on four areas of the aquaculture industry specifically, Francisco Saraiva Gomes said: Health and nutrition, hatchery and genetics, fishmeal and oil and large-scale farming.

"There's a lot of [progress] that can happen focusing on the hatchery and breeding of the animal," he said about one of those areas.

"This is one of the reasons why the poultry industry has earned such wide-scale success."

-- Avani Nadkarni

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Wednesday, April 29, 9.55 am EST

'Aquaculture is not poultry'

Francisco Saraiva Gomes, CEO and director of Pontos Aqua Holdings, who has an extensive background in aquaculture, said while the fish farming industry is often compared to another popular protein, it's not the same at all.

"We tend to compare aquaculture to poultry, like it is one industry," he said. "But it is not, it's a bunch of different industries. These symmetries ... they generate obstacles for investment but they also generate opportunities."

-- Avani Nadkarni

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Wednesday, April 29, 9.40 am EST

Baja California: The next top fish farmer?*

Matias Arjona, the Secretariat of Fisheries and Aquaculture for the US West Coast-adjacent Mexican state of Baja California, spoke of the aquaculture industry in his state, which he said has more than 1,000 kilometers of coastline between the Gulf of California and the Pacific Ocean.

“The vision of our state is to become a leader in aquaculture, mariculture," he said and added that it hopes to increase production by 100 percent in the coming five years.

The state produces or has the potential to produce a diverse group of species, including yellowtail, bluefin tuna, catfish, clownfish, abalone, scallops and oysters.

In addition, the Offshore Mariculture Conference, which attracts industry leaders from around the globe, will be held in Baja California for the first time this September.

-- Avani Nadkarni

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Wednesday, April 29, 9.20 am EST

Mexican government official: 'Don't get disheartened'*

Roberto Arosemena of the Fisheries and Aquaculture Commission of the Mexican government, urged the gathered investors and potential investors to not "get disheartened" when attempting to grow a fish farm in the country.

"“I would invite you to continue to make effort and there’s a lot of aquaculture potential in Mexico," he said.

"We have raw materials, we have infrastructure and potential and it’s well worth your support. After all is said and done, as government, we’re here to support you. We all have a passion for aquaculture and we want to do what we can to assist with the development of aquaculture and the great potential it has. We have to look to the future and not just the present and make sure the future becomes a reality."

-- Avani Nadkarni

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Wednesday, April 29, 9.00 am EST

Why is the soybean industry interested?

"We're investing in aquaculture because we think -- we know -- that this is going to be an industry that will be feeding soy to the fish," US Soybean Export Council (USSEC)'s Francisco de la Torre told attendees.

"You're already marketing this product, you're already buying this product. For those that market these seafood products, they have to see the advantages of buying products from aquaculture--there's a lot more flexibility and there's a lot more standardization in an aquaculture product than a product that's harvested from the sea."

-- Avani Nadkarni

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Tuesday, April 28, 6.45 pm EST

Why not go beyond fresh tilapia?

Shrimp and tilapia are not only two of the top traded seafood products around the world, but both are also major import commodities for the United States and in high demand, said USSEC.

Latin America has snagged more than 98 percent of the US fresh tilapia market -- so why not go for the frozen fillet market? The shrimp market? Beyond?

Growing domestic demand in Asia is absorbing the powerhouse continent's production -- so when and how should Latin America step in?

These are some of the notions that will be discussed at the event.

-- Avani Nadkarni

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Tuesday, April 28, 6.30 pm EST

Miami rains

As attendees gathered in Coconut Grove, Florida--about 20 minutes from the Miami airport and close to the University of Miami, where the workshop will be held, dark clouds and thunder are looming over the generally-sunny city.

The event will officially kick off bright and early Wednesday with a day of panels, followed by a half day of panels and a tour of the University of Miami Rosenstiel School of Marine and Atmospheric Science (RSMAS) hatchery.

-- Avani Nadkarni

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*Blog entries marked with an asterisk note that the speaker was giving the presentation in Spanish and quotes are translated through an interpreter.

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