INVESTMENT IN OFFSHORE CAGE PRODUCTION Lukas Manomaitis - - PowerPoint PPT Presentation

SOUTHEAST ASIA – PREPARING FOR INVESTMENT IN OFFSHORE CAGE PRODUCTION

Lukas Manomaitis Aquaculture Program Technical Contractor/Southeast Asian Technical Director USSEC

• Soy is one of the most important commodity

crops worldwide and has attributes that make it ideal for aquaculture

• USSEC is a non-profit marketing organization for

the U.S. soy industry (we do not and cannot sell soy)

• Funded by U.S. soybean farmers and the U.S.

government, with additional funding from industry stakeholder members

• USSEC has worked since 1985 in aquaculture
• Global program with a strong regional

aquaculture program in SEA since 2002

• Multi-level approach to industry taking a

production/value chain view to improvement (knowledge transfer)

U.S. Soybean farmers in a soybean field

WHAT IS THE U.S. SOYBEAN EXPORT COUNCIL (USSEC)?

SIMPLIFIED PRODUCTION CHAIN FOR AQUACULTURE

USSEC’s interest in marine fish aquaculture and presentation discussion plan

• USSEC sees the marine fish industry in SEA

as a large potential future user of soy products, particularly U.S. soy products

• A paper was submitted for this conference,

please refer to this for a detailed outline of what USSEC believes the status is

• There are both immediate opportunities

and medium to long term opportunities for those interested in industrial marine fish production in SEA

• Think of this presentation as a spotlight of

key issues, feel free to meet with me to discuss more!

ASEAN Government Targets for Aquaculture to 2020

Country Strategy and Existing Target Indonesia

• The “largest aquaculture producer”;
• High double digit annual growth rates.
• Dramatically expanding brackish water aquaculture production areas.

Malaysia

• Additional 120,000 tonnes of marine fish from cage aquaculture
• Creating 10,000 hectares of new integrated shrimp production zones.

Philippines

• Aquaculture production increased by 1 million tonnes over 5 years.
• Milkfish (marine aquaculture) and Tilapia for domestic mass market.

Thailand

• Filling the supply gap that is developing in wild capture supplies
• Additional 500,000 tonnes of aquaculture production per annum.

Vietnam

• Additional 200,000 tonnes of marine fish from cage aquaculture.
• Additional 250,000 tonnes of brackish Shrimp
• Additional 700,000 tonnes in Pangasius.

Source: National governments (2013 information)

• As much as smallholders may like to farm marine fish, the future is not

going to be smallholder farmers

• We need to take the positive lessons from other livestock operations

(and good examples of marine fish production) and copy/adapt them

• Marine fish production, though today still quite low for medium to high-

value species, has a very bright future

AQUACULTURE IS A LIVESTOCK INDUSTRY – MANY OPPORTUNITIES

Aquaculture is a livestock industry, we need to develop/copy the industrial approach

• f livestock

• Offshore does not mean “in the middle of the
• cean”
• Located far enough away from the coast to allow

greater depths and currents

• Located close enough for land-based logistical

support

• Should be situated in areas that have been

previously identified as zoned for aquaculture

• Require advanced cage technology to withstand

harsher conditions, though many areas in SEA actually have relatively calm waters

Modern marine cage operation

WHAT IS “OFFSHORE” CAGE FARMING?

Attractions for marine fish aquaculture in SEA:

• Familiarity and acceptance of

aquaculture as an industry

• Well-developed aquaculture feed

production and seafood processing in most nations

• Sub-tropical to tropical

conditions that allow year-round culture ability

• Long coastlines and good water

quality

• High market value and good

potential markets with increasing demand

• Already linked regionally and

globally to international seafood markets

• Many possible target species

Challenges for marine fish aquaculture in SEA:

• Security
• Short term thinking/copying the

wrong models

• Lack of/need for better

technologies: – Hatcheries – Health management – Targeted feeds – High tech production approaches – Staff trained in better technology approaches

• Lack of capital

resources/investment funds

• Maybe one of the most important

questions when it comes to moving away from the protection of the nearshore – how will an operation be protected?

• In Turkey, they had a simple answer:

“security systems, guns and phones”

• Governments are going to have to

help to secure the zones for offshore aquaculture

Perhaps a bit “over the top”, but hard action will be needed initially (and is already happening)

WHAT ABOUT SECURITY?

• The technology for offshore, industrial

marine cage aquaculture production exists today, the technology is quite

• advanced. Many companies ready to

supply SEA with what is needed

• The other parts of the production

chain; hatcheries, nurseries, health management, logistics, etc. are fairly well understood, but need to be implemented correctly in SEA (immediate opportunities in this sector?)

Underwater camera and automated feeding systems

WHAT ABOUT TECHNOLOGY?

• The basics of nutrition for marine fish feeds

exist and will get better

• Currently farmers (and therefore feedmills

too) are not willing to invest in better feeds because it is too risky

• USSEC is also working to improve formulation

approaches by commissioning the first standardized aquaculture formulation database for use by, and training of, aquafeed formulators

Feed barge with several silos of different feeds for different stages

WHAT ABOUT FEEDS?

• Labor is going to be an important issue

to address (particularly the linkage to governments):

• The transition from many small farmers

(AKA voters) to less farmers and more people employed in the overall industry is going to be a delicate one

• While there are a lot of people now working

in the aquaculture industry, those that will remain in the production side will need to be selected and retrained

• There are many academic institutions for

aquaculture, but very few currently looking at the offshore industry

Land-based logistics and large boat support

• f cage operations

WHAT ABOUT LABOR?

• USSEC commissioned a report on this in 2013

to see the investment climate for aquaculture in SEA

• Key issue was restrictions by governments in

some areas that prevent outside investment

• However, investors (international and local)

are aggressively looking to expand into this industry in the near future

• The ASEAN Economic Community (AEC) will

be a big change for everyone

• Governments will need to decide what

whether they will make this an opportunity –

• r treat it as a threat

Aquaculture events are attracting investors

WHAT ABOUT CAPITAL RESOURCES?

Concluding thoughts on offshore aquaculture

• How will offshore aquaculture happen in SEA?

– Not at all, will retain primarily nearshore production? – Quickly, as in Turkey, the change will be over a short time? – A blended approach, with nearshore mostly phasing out with offshore developing as the primary production?

• Key issues to focus on:

– Broodstock, hatcheries and nurseries (genetics, vaccination and quantity/quality production) – 20+ million quality fry minimum – Growout (zoning and licensing, appropriate technology, insurance and professional staff) – work with governments and good quality equipment and people – Processing and marketing (identifying key species, targeting volumes that can be exported, transitioning from wet markets to processed fish) – escape the domestic demand trap – Sustainability and high quality (standards and/or certification)

Concluding thoughts on offshore aquaculture

• What will an industrial offshore industry offer?

– Higher profits – More jobs – Reduced risks – Sustainability and quality – Greater capital/more investment – More consistent and greater supply of products

• What does SEA need to be careful about?

– Stopping negative thinking - less smallholder farmers does not mean a smaller industry! This will be an important aspect, particularly in discussions with governments. – Critical that this process be done correctly, otherwise those that try to “shortcut” the development process with poor practices/equipment/planning will impact the possibility for investment for the entire industry. – Investors have been hesitant about investing more in aquaculture in Asia, will need to show them it can be done better – this is where an experienced integrated

• perator could come to SEA and spark a wholesale change in the SEA region

FY14 USSEC 1st SEA OFFSHORE TOUR GROUP TO TURKEY AND NORWAY

NEXT TRIP: WE ARE SEEKING A NEW LOCATION TO BRING A SEA GROUP

IS THIS SEA’S FUTURE AQUACULTURE?

REALISTICALLY IT HAS TO BE

A SPECIAL THANKS TO THE ORGANIZERS OF THE OFFSHORE MARICULTURE CONFERENCE AND THE STRONG SUPPORT FROM OUR MANY INDUSTRY STAKEHOLDER MEMBERS

Verified Grains Thayer Seed Knewtson Soy Products

The Global Soy in Aquaculture program strives to promote a profitable and sustainable approach to aquaculture that specifically shows the utility and value of U.S. soy products

Learn more about USSEC and aquaculture: www.soyaqua.org Contact USSEC SEA at: LManomaitis@ct.ussec.org