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Technical progess in salmon growing

By Adelard (Ed )Cayer

Simply stated, aquaculture is one of many forms of food production that is used to meet food and nutritional market demand. As such, aquaculture’s commercial success in the market place is determined in the same manner as successful production and sale of other forms of food.

Options for locations and forms of aquaculture production are varied. Home and family aquaculture farms were the dominant form of aquaculture for some 2,500 years and the re-birth of hobby and backyard aquaculture farms has begun.

Located both on land and in marine and freshwater environments, the last half century has seen rapid commercial aquaculture expansion in coastal waters around the world.  

In the past decade, land-based investments designed to increase productivity, animal health, eliminate environmental impacts, reduce risk, enhance management and improve product quality have focused on re-circulating aquaculture systems (RAS) solutions.

Initial system designs resulted in achievement of all of the aforementioned objectives. However, this was achieved at a substantial energy cost that detracted from the financial competitiveness of these early land-based aquaculture investments. Moreover, added to these early additional energy costs, land-based efforts were further frustrated by an aquaculture regulatory and taxation environment based on open-water aquaculture leases and licenses.

While governments have been slow to make improvements in the regulatory and taxation environment, progress has been made on the technical side.

In 2011, the Atlantic Salmon Federation partnered with the Freshwater Institute in West Virginia to carry out a grow-out trial for Atlantic salmon.

The trial showed that Atlantic salmon can be reared to harvest size within 12 months in a land-based closed containment system.  Results of the commercial scale grow-out trial provided at the Atlantic Salmon Federation on October 10, 2012 shows that salmon can be produced on land without pesticides, chemicals or antibiotics at a total cost of $1.70/ lb. ($3.74/kg) and that:

  • It does not degrade the environment on which it depends.
  • It is in harmony with other economic, cultural and social activities that use the same natural resources.
  • It does not diminish the ability for future generations to use the same resources.
  • It invests in local communities and decision-making is local.
  • It produces a reasonable and relatively stable net income to both producers and society by using natural resources on a long-term, renewable basis.

On the supply side of aquaculture, costs of production determine relative competitiveness with other forms of food production. These costs include capital, operating, social, environmental, regulatory and taxation costs. The resulting price set by producers is determined by these costs and the margin which the producer adds to the cost, to accommodate risk and profit.

Comparative price, quality, nutritional value, source and production techniques, brand preference and food safety determine consumer product demand. Consumers and sellers each determine the value of the aquaculture product in a free market and arrange an exchange of the product for money if both parties agree on a fair market price.

The important caveat here is that the value of the aquaculture product must compete with every other form of food that is available at the same price, in the consumer food selection process. Products that are competitive in this marketplace become commercially viable. Products that are not competitive result in failed business ventures.

Today, commercial land-based salmon production facilities are being built in British Colombia, Denmark and Tennessee. These and others to follow will provide healthy production and commercial competition to existing forms of salmon aquaculture as a high-value food product.

Adelard (Ed) Cayer is an economist and international development specialist living in Shelburne, Nova Scotia. He has operated a successful land-based aquaculture facility there.