‘Land based farms in Canada years away from being profitable’

Salmon Business

“Land-based salmon farming does have a future in B.C., but as a complement to ocean farming, not a replacement.”

A recent study of the International Salmon Farmers Association (ISFA) concluded that land-based salmon farming is fine for raising smolts, but faces serious financial and technological limitations when it comes to raising salmon to maturity, reports Business Vancouver.

The conclusion is shared by Steve Atkinson, president of Taste of B.C. Aquafarms in Nanaimo, which raises steelhead at its Little Cedar Falls fish farm.

“There’s nobody yet that’s made money on land based salmon farming, including us. As far as transferring the net cage industry into land-based operations, we’re years away. Land-based salmon farming does have a future in B.C., and our farm is showing that. But I see land-based salmon farming as a complement to ocean farming, not a replacement,” said Atkinson.

Success based on subsidies
B.C. is littered with failed attempts to grow either Pacific or Atlantic salmon in land-based recirculating aquaculture systems (RAS) over the past 20 years.

Only Kuterra, a land-based salmon farm near Port McNeill, has had some success, but mainly because of subsidies from government and non-profit organizations. Its owners, the Namgis First Nation, started raising salmon at the fish farm in March 2013 and began selling its fish one year later. But in June, the Namgis put the facility up for sale.

Brad Hicks, director of BC Salmon Farmers Association (BCSFA), last year did a financial analysis of Kuterra that concluded it is seven times more expensive than ocean-based salmon farming.

Kuterra land bases salmon farm. Credit: Kuterra.

Namgis Chief Don Svanvik said the project just needs to scale up to become profitable. “If the farm is even twice the size it is now, we’d be making money,” Svanvik said.

The project’s original capital cost was $8.8 million. It ended up costing $10 million, Kuterra chairman Eric Hobson confirmed. When operating costs are added, he said the total investment in the project thus far is about $15 million.

The Government of Canada invested $6 million in the project, Tides Canada and the Gordon and Betty Moore Foundation provided $4 million through the Sustainable Aquaculture Innovation Fund. Another $1 million came from private donors. The Namgis covered operating costs totalling about $4.5 million – $1.5 million in equity and $3 million in loans.

While Kuterra is not yet profitable, Hobson said it is breaking even.

Difficulties selling products
Land based farmers also have difficulties selling their products. West Creek Aquaculture, for example, can’t find buyers in B.C. for its land-reared coho and sockeye.

“We sell all of our coho everywhere outside of B.C.,” said Don Reed of Willowfield Enterprises, which owns West Creek Aquaculture. “No one in B.C. will buy our fish because it’s farmed. Our inability to sell our land-based salmon is directly related to the campaign against ocean farmed salmon.”

Kuterra has been more successful in finding buyers in B.C., some of whom pay a 30 percent premium over farmed salmon from open net cages.

“As a technology demonstration project, Kuterra is a success story. It has shown that Atlantic salmon can be grown in land-based closed-containment systems. But that doesn’t mean it will be a profitable business,” BCSFA director Hicks concludes.

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