A bill calling for a ban on salmon farms in Washington State has received support from Gov. Jay Inslee and the state Senate.
Norway-based Nordic Aquafarms (NAF) plans to construct a 40-acre land-based Atlantic salmon farm in Belfast, Maine. It will have a 33,000-ton annual production capacity.

Between $450 to 500 million all-in total capital investments will be involved to complete the project, which will be implemented in several phases.

The first phase, with construction planned to start in 2019, will involve investments of up to $150 million. The facility will be an end-to-end operation, including hatcheries and fish processing. It will be the largest land-based facility project ever raised in one construction phase and house the largest aquaculture tanks in the world, the company claimed.

CEO Erik Heim said they are “stepping up investment in highly qualified people and international partnerships.”

The controversial salmon escape incident at a salmon farm in Washington State in August cast a dark shadow over the salmon industry, but developments in the State of Maine are buoying US industry outlook.
The salmon escape incident at Cooke Aquaculture’s farm near Cypress Island in Washington State could have been avoided if Cooke Aquaculture had properly maintained the nets, according to a state investigation.

The company was fined $332,000 for the release of thousands of Atlantic salmon in August, the Washington State Department of Ecology announced Tuesday.

The incident invited new scrutiny on the industry and intensified concerns over the effects of foreign fish on wild Pacific salmon native to the area.

Previous estimates, based on Cooke's reports, put the number of escaped fish at 160,000, but the state probe put the number of escaped salmon at 250,000.

The state investigation also found Cooke poorly cleaned and maintained the nets, failed to follow repair protocols, and paid insufficient attention to engineering.

“This investigation confirms Cooke Aquaculture was negligent in operating its net pen,” Ecology Director Maia Bellon said in a statement. “What’s even worse is that Cooke absolutely could have – and should have – prevented this incident.”

Cooke Aquaculture has issued a statement denouncing the results of the state investigation, saying that it was "incomplete, inaccurate and conducted by investigators with limited experience in aquaculture or net-pen operations.

Cooke Aquaculture issued scathing press release today pre-empting the official announcement of the findings of the investigation into the collapse of the company's salmon net pens in Washington State, due today at 11 am PST.
Misuse could create openings for new pathogens, says study

The use of antimicrobials in aquaculture has not reached a critical mass but it is important to consider reducing their use, says a study.

The study, Unpacking factors influencing antimicrobial use in global aquaculture and their implication for management: a review from a systems perspective, noted that use and overuse of antimicrobials within an aquaculture system can wipe out good bacteria that help maintain a balance along with the targeted pathogens. This could create openings for new pathogens.

“What we found was that there are a lot of roads where you can reduce antimicrobial use,” says Patrik Henriksson, researcher and lead author of the study led by WorldFish, in collaboration with the CGIAR Research Program on Fish and Agri-food Systems.

To reduce antimicrobial use, the study recommends the use of probiotics to strengthen good bacteria; applying effective spatial planning to reduce disease spread between farm sites; applying better management practices, and developing stricter regulations for antimicrobial usage.

Henriksson noted the Norwegian salmon industry’s efforts to develop disease-free fish seeds and vaccines. He would like to see national governments and international organizations assist with the development of similar techniques for species such as carp, which is critical for nutrition in nations such as Bagladesh, Burma and parts of China.

The report also calls for increased education on the topic for farmers around the globe. “One of the big problems today is that a lot of farmers, especially in countries in Asia or Africa, they don’t have the knowledge or resources to identify the type of disease they have, or they don’t know the consequences of using antimicrobials,” says Henriksson. “Simply by educating farmers and giving them better capacity to diagnose their diseases could result in huge reductions in antimicrobial use. We don’t have to stop using them, we have to use them more wisely.”

Jeremy Dunn, executive director at the BC Salmon Farmers Association (BCSFA), is leaving the association to move over to Marine Harvest Canada beginning May 1.

BCSFA said it is now searching for his replacement.

Dunn will be joining Marine Harvest Canada's Public Affairs division. He will replace Ian Roberts, Marine Harvest's Director of Public Affairs, who announced his transfer to Marine Harvest Scotland's operations earlier this month.

 “The past four years with the BCSFA has been an incredible experience and introduced me to the talented women and men working in BC and the global seafood sector,” says Dunn. “This experience has led me to want to become involved on a deeper level, and I’m excited to join Marine Harvest. I can’t thank the board of directors enough for their guidance, leadership and support.”
Shrimp disease issues in China have dragged down sales of Hawaii’s shrimp broodstock for the second year in a row, data from the US Department of Agriculture’s National Agricultural Statistics Service (NASS) show.
Sociologist names key requirements for companies to ‘acquire’ social license. Failure in any one of them could seriously threaten a project’s acceptance, he says.
The climate of uncertainly around the tenures of provincial salmon farming operations in British Columbia could dampen investor interest, according to the BC Salmon Farmers Association (BCSFA).

Salmon tenures in the province became a hot-button issue in October after BC Minister of Agriculture Lana Popham’s letter to Marine Harvest Canada (MHC) was made public. Some perceived the letter as threatening.

As reported in the Nov/Dec issue of Aquaculture North America (ANA), the letter warns MHC for stocking a farm in the Broughton Archipelago area between Vancouver Island and the BC mainland amidst the company’s dispute with the Namgis First Nation, which claims the area as traditional territory. MHC said it went ahead with stocking the smolts “for the safety of the fish.” The police were on site to ensure the protestors occupying the farm did not interrupt the transfer.

Salmon farms have a tenure agreement with the Ministry of Forest Lands Natural Resource Operations and Rural Development that gives them the right to operate on BC Crown land and water. However, some local First Nations want the right to control what activities go on in their traditional territories.

“Our members are still caught in the middle of a dispute between governments and those governments need to discuss what the best route forward is,” says BCSFA executive director Jeremy Dunn. “We are hopeful that the route does not significantly impair or collapse an industry that is worth over $1.5 billion to the province and results in 6,600 jobs.”

Shape up or ship out?

Popham’s letter to MHC went on: “Whatever operational decisions you should chose to make, the province maintains all of its rights under the current tenure agreements including potentially the requirement that you return possession of tenured sites a the end of the current terms. My colleagues from the Ministry of Forests Lands Natural Resource Operations and Rural Development will be in touch with you to describe the process for you to initiate applications for replacement tenures.”

Most salmon farming tenures in BC are for 20 years, but after a lengthy consultation process culminating in 2013, the government reduced that term to five years for farms in the Broughton area. Licenses with Fisheries Oceans Canada (DFO) are typically nine years. MHC has nine sites that are up for renewal this year. Other companies operating in the area, Grieg and Cermaq, are also subject to five-year terms in the area.

Popham letter appeared to warn salmon farmers and indeed, all who hold tenures with the government, about the importance of collaboration with the First Nations.

“Our government has committed to implementing the United Nations Declaration on the Right of Indigenous People (UNDRIP),” Popham wrote in the October 13 letter. “Practically that means that companies should make every effort to develop and maintain healthy relationships with First Nations in whose territories they are doing business.”

The letter could be taken to imply that the BC salmon farming industry is not following due process in their agreements, when in fact that is simply not the case. The BC Aquaculture Land Use Policy lays out how that consultation will take place. “Currently there is a required First Nations involvement in the tenure process,” explains Dunn. “There are a number of consultation requirements that the Crown undertakes and requirements for the companies to participate in those consultations, which our members are more than happy to do.”

If the rules are changing, BC salmon farmers haven’t been told yet.

“We are trying to find out what our future pathway looks like,” says Dunn.

“This new relationship and changes in the way things are done has not presented itself in a policy directive change as to how the consultative process around a tender would take place,” says Dunn. “The premier is on record as saying that how BC engages with First Nations will change. But what does that look like?”

Dunn says salmon farmers have 20 working agreements with First Nations in whose territories they operate, something that is not required by legislation.   “I think our members go beyond what the rules are around consultation,” he says. “In many cases our members have developed First Nation partnerships that include benefit agreements for a majority of their farm sites.”

“The farm sites in the Broughton are the only areas where we have a dispute and don’t have a good working relationship,” says Dunn. “There have been a great number of attempts at consultation and the First Nations there have been less than willing to engage in constructive dialogue.”

Businesses of BCSFA members, both on the farming and the supply side, are planning some $300 million in new investment over the next four years, Dunn says. “It wouldn’t be a surprise to me if some of those decisions are being delayed.”  

“We have many First Nations businesses contracted to the sector wondering what the future looks like,” Dunn says. “Right now, unfortunately, we can’t give them a very solid answer. That is something we are hoping to change soon.”

(This article was first published in Aquaculture North America's Jan/Feb 2018 issue.)

Donald Trump considers the North American Free Trade Agreement (NAFTA) to be “the worst trade deal” in American history, and vows to either scrap the agreement or to replace it if he does not get the changes he seeks. So far, Trump has settled for renegotiation. This means Canadian, Mexican and US trade negotiators will discuss for much of 2018.

NAFTA centres around auto manufacturing and other such sectors, but players in the aquaculture industry would be wise to prepare for uncertain times ahead.

Neil Anthony Sims, co-founder, CEO and CSO of Hawaii’s Kampachi Farms LLC believes that even if NAFTA were completely revoked, seafood imported from Canada or Mexico into the US would remain tariff-free. US consumption of seafood far outstrips domestic production. Imposing tariffs would make it harder or more expensive to get seafood to American consumers, which would be detrimental to both national economic and consumer health.        

“You may have activists or populists saying we need to impose tariffs on imported products because we need to protect the local industry,” says Sims. “There is a very, very small local [seafood] industry. Mexican and Canadian products don’t compete significantly with US products. Everybody in this industry recognizes that we need to grow the industry in the US and the main challenge to that is not the imports. The imports are a symptom, not a cause. The cause of the failure to grow the aquaculture industry in the US is the lack of political will.”        

Jeremy Dunn, executive director of the British Columbia Salmon Farmers Association (BCSFA) agrees, noting that the United States imports significant wild and farmed seafood from not only Canada and Mexico but also Norway, Chile and nations in South East Asia.

“From a seafood perspective, I would say that no one benefits,” says Dunn regarding potential changes to NAFTA. “There would be some level of uncertainty for producers and for consumers. But there isn’t a benefit either way, really.”

Dave Rudie, president of San Diego-based fish distributor Catalina Offshore Products, says NAFTA has very little effect on the industry. Pre-NAFTA, import duties on seafood products were low, he says. But there are things that concern him.

“If NAFTA were to be overturned, it would go back to what it was before,” says Rudie. “It would not have a huge effect on the seafood business. The scarier thing that we’ve heard about is the possibility of a 20-percent border adjustment tax. If there were to be a 20-percent import tax on seafood from Mexico, that would make a huge difference. If NAFTA blows up and there’s a trade war, then anything is possible.”

One of the trickier aspects of the NAFTA renegotiation is “laws of origin,” which has come into play in circumstances where, for example, a car manufacturer may be using parts from other nations; would the manufacturer have to pay tariffs on those foreign parts? It is unknown what form such changes would take or how they could impact the industry.

“One of the aquaculture companies that I buy from is Baja Seas Hiramasa,” says Rudie. “They’re buying their food for the hiramasa out of Canada, growing it in Mexico and it’s primarily marketed in the US. It’s a product of Mexico, but some of the food that goes into the fish is coming out of Canada. I don’t know if that would be affected by any change in rules or not.”

Seafood market analyst, John Sackton, says that while tariffs would likely return to the low levels they were pre-NAFTA, a change to the agreement could disrupt the business plans of individual producers.

“If you have an investment into oysters or salmon or something that’s a two- or three-year cycle, and then all of a sudden the market landscape at the end of your three-year cycle is totally different than when you first put the product in, that’s a significant problem. That can be very disruptive,” says Sackton, who publishes Seafood News.

Canadian view

Canada recently signed a free trade agreement with Asia-Pacific. While that and the diversity of Canada’s trading partners around the world could help Canadian producers make up for some lost sales if NAFTA was revoked, Sackton notes that the Canadian industry is still significantly tied to the US.

“If you look at not just the broodstock but the drivers of Canadian aquaculture, for instance, salmon and mussels and oysters, the US is far and away the primary market for those,” says Sackton. “Even if they increase sales in Europe or Asia, the US is still going to be the largest [market] by far. The Canadian producers and the US market are very intertwined. Even if you add costs, you can’t really separate the two.”

All four observers we spoke to agreed that altering NAFTA would not benefit the aquaculture industry. Even if prices increase on imported seafood products in the US (thus benefitting US producers) this would not help the industry’s more prevailing need, which is to get consumers to eat more seafood. However, as aquaculture is not a big factor in NAFTA discussions, the industry may end up being a victim of decisions made in support of other sectors of the trading relationship between Canada, Mexico and the USA.

“I’m hoping it doesn’t have an effect, but you never know for sure,” says Rudie.

“If there is any suggestion at all that seafood is added as a tariff commodity, the industry will be in an uproar,” says Sims. “There is universal, vehement support for tariff-free flow of seafood into this country because we are so totally dependent on it.”

“The trade between our two countries in a number of products is important,” says Dunn. “I think that anybody involved in the seafood business should absolutely be paying attention because this is a very important bilateral relationship between Canada and the United States.”

Global harvest volumes for farmed salmon will see moderate growth this year, with supply from traditional and non-conventional sources including land-based salmon farming contributing to that growth, says an analyst.
Cooke Aquaculture Pacific employees in Washington State on Tuesday testified before a state Senate committee against a bill that would ban Washington’s long-standing salmon farming industry and effectively terminate their employment.

Senate Bill 6086, sponsored by Washington State Senator Kevin Ranker, calls for a ban on any new leases for net pen aquaculture in the state, leading to a total phase-out by 2025.

“This bill will immediately cease the issuance of permits necessary to conduct normal operations at each of the four salmon farms in Washington,” said Troy Nichols, lobbyist representing Cooke Aquaculture Pacific. “The bill will kill dozens of rural, family-wage jobs were it to pass, and it acknowledges as much.”

Tom Glaspie, the site manager of Cooke’s Hope Island Fish Farm near Anacortes, was one of several employees who addressed the committee at the public hearing. He expressed the sentiments of his colleagues: “We’re worried about our jobs… I’ve been doing this my whole adult life. I invite all of you to come out and look at what we do before you judge it, and you’ll see how sustainable it is.”

Cooke said it currently employs over 80 individuals directly and supports 100 workers on harvesting boats and in processing plants, representing an investment valued at more than $70 million into Washington’s economy.

The company is urging lawmakers to make their decision based on the best available science and not on unfounded fears regarding the impact of Atlantic salmon on the health of native stocks.

A Los Angeles-based private equity firm specializing in the food sector says it has acquired Pacifico Aquaculture based in Ensenada, Baja California, Mexico.

The terms of the transaction were not disclosed.

Founded in 2010, Pacifico Aquaculture is permitted to grow several types of species on their farm site but the company has found its niche in the "true" striped bass (non-hybrid) — Morone saxitallis — for markets in the United States and the Americas.

The investment firm is Butterfly Equity, which its website says specializes in the food sector “spanning the entire food value chain from ‘seed to fork’ via four target verticals: agriculture & aquaculture, food & beverage products, food distribution and foodservice.”

"This is an exciting new chapter for Pacifico and we look forward to our partnership with the Butterfly team," said Omar Alfi and Daniel Farag, Co-CEOs of Pacifico. "Butterfly understands our business well and shares our vision for the future, and we are excited to have a partner with deep industry expertise in the food sector."

"The future for sustainable ocean-raised aquaculture is extraordinarily bright and we are excited to back the Pacifico team to help expand their reach throughout North America and around the world," said Adam Waglay, who co-founded Butterfly alongside Dustin Beck.

Cooke Aquaculture is making sure its voice is heard at a public hearing January 9 that will discuss a bill calling for a ban on any new leases for net pen aquaculture in Washington State.

Senate Bill 6086, sponsored by Sen Kevin Ranker, would effectively end the operations of Cooke Aquaculture in the Puget Sound. The company is the only commercial salmon farming company permitted to operate in the area.

Ranker’s proposal stems from the salmon escape incident at a Cooke Aquaculture farm in Washington State in August. Major concerns over such incidents include the spread of parasites and pathogens to wild stocks.

But Joel Richardson, Vice President of Public Relations for Cooke Aquaculture, is urging legislators to make decisions based on best available science and not on unfounded fears. “We acknowledge that the fish escapement prompted some understandable fears and concerns about the impact of Atlantic salmon on the health of native stocks, but we are urging lawmakers to recognize that these fears are not borne out by the history or the best available science.”

He emphasized that banning a legal operation such as Cooke’s “would be a draconian response and a very unfortunate mistake.”

Cooke, he said, has been providing  “sustainable and affordable source of locally-grown protein, represents tens of millions of dollars of investment in the state and has provided good, family-wage jobs in rural Puget Sound for over 30 years.”

He added that Cooke is taking responsibility for the "regrettable incident" and is addressing it.  For instance, Cooke is supportive of other legislative approaches to the issue, which include a review of all existing aquaculture regulations, regular inspections of net-pen facilities, and a local academic study of net-pen aquaculture and its impacts on the ecology.
“We are prepared to put forth suggestions for best regulatory practices that have worked in other states like Maine and in locations all around the world,” said Richardson. “Cooke has offered to help fund a scientific review of net pen aquaculture and the impacts of accidental escapes.  And Cooke is willing to explore ways to help the State improve native fish runs and augment state and tribal hatchery operations. We’ve been in Washington state for a little over a year now, but our company is one of the best in the world when it comes to both, and we want to share our experience and expertise to ensure that Puget Sound waters continue to have fish for tribes and commercial fisheries to fish for generations to come.”
Richardson said banning Cooke’s ability to continue its operations forecloses these possibilities.

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