Expansion at NZ King Salmon

July 2013

A thriving sea-farmed salmon operation works to expand its operation

A look at NZ King Salmon’s expanding farming interests in Marlborough Sounds.

It’s only 30 plus years since fish farms were first seen in NZ, although salmon was introduced here over 100 years ago.

King salmon or Chinook salmon is the only salmon species sea farmed in New Zealand, with New Zealand King Salmon the world’s major supplier of this species.

NZ King Salmon currently has 5 farms in the Marlborough Sounds – collectively they are estimated to produce around 7,500 tonnes each year. That accounts for roughly 70% of NZ’s salmon production. Total sales are in excess of $115m.

The product is sold around the globe but specifically into the Australian, Asian and US markets, with more recent markets opening up in Europe and Scandinavia.

The company believes it has some clear market advantages. Its a unique species, in that king salmon (with a more delicate flavour with higher omega-3s) is sustainable, disease free, chemical free and the fish are grown in a clean growing environment.

As a business they’re vertically integrated, meaning they can follow the production chain all the way from harvest through to the market.

Late last year NZ King Salmon embarked on a consent process to establish a further 9 farms in the Marlborough Sounds. The aim was to significantly increase the company’s production, however the application process met with stiff opposition from some sectors in the Sounds community.

1200 submissions were heard from the public with around 2 out of 3 opposing the company’s plans (most coming from a single group). The Environmental Protection Authority hearing took several weeks. The EPA was set up by the government to streamline the planning process for projects like aquaculture. It was also seen to signify the government’s enthusiasm for new aquaculture ventures.

The process is estimated to have cost NZ King Salmon roughly $10m. The EPA granted consent for a further 4 farms (not the 9 requested). That decision has been appealed by two groups.

It’s estimated with four new farms NZ King Salmon will be producing around 15,000 tonnes of salmon annuall, bringing in significant export income and adding jobs to the region.

The final approval to build four new fish farms in the Marlborough Sounds was granted in Feb 2013 and NZ King Salmon say it will be at least late 2015 before the first fish go in the water and the first fish harvest is expected in 2016.

The four farms will be at Ngamahau in Tory Channel, Waitata and Richmond in Pelorus Sound and Papatua in Port Gore.

The salmon are brought out to the finishing farms from the three hatcheries operated by King Salmon as 6-12 month old fry/smolt. They stay on the sea farm for anything from 12 – 18 months and are harvested at around 4 kg.

Most of the opposition to additional salmon farms in the sounds comes from those concerned about the farm’s environmental impact. Before the new fish farms are allowed to be built, NZ King Salmon had to undertake to appoint an environmental committee and take scientific measurements for at least a year, and two years on some sites. The company has agreed that it would research nitrogen levels in the Sounds, monitor king shag populations and a peer review panel of scientists would make their feedback public.

NZ King Salmon’s Technical General Manager Mark Preece says the company has also been working with the locals to address the look of the farms, addressing issues like the visual impact/colour schemes etc.

Opposition to the new farms raised concerns about the amount of N that goes into the ecosystem. Some have alleged that the new farms would create the same levels of N loadings as dairy cows. The Board of Inquiry found the environmental impacts to not be significant.

At the same time as these issues were being raised by those against the new salmon farms, the company announced in early 2013 that it had achieved certification from the Global Aquaculture Alliance for its farming operations. Essentially the company has been awarded an industry sustainability award known as Best Aquaculture Practices (BAP) Certification. The certification covers all NZ King Salmon’s operations – five fish farms and three production units in Marlborough and Nelson. It indicated the company’s new Marlborough Sounds farms would be audited as they came on stream.

The GAA’s certification examines farm compliance issues such as community property rights and relations, worker relations, the environment, fish management and welfare, wildlife interactions and supply storage and disposal.

The company’s operations were audited by an independent experienced Australian-based certifier who was contracted to the Global Aquaculture Alliance, and audits will be carried out annually.

NZ King Salmon says the certification is important for offshore markets where some customers go looking for certified producers. Traceability is a very big part of getting the certification.

Salmon farmers say there are a number of factors at play when choosing a fish farming site. The depth and flow of water is important as is the temperature and shelter. The water needs to be clean and well-oxygenated. Ideal water temperature is around 12-17 degrees C.

The farm pens are up to 20m deep. The nets are suspended from floatation pontoons. There’s a perimeter net to try and keep predators at bay.

The farms are designed to be moveable so that a fish farm site can be periodically fallowed to allow the environment around the farm to recover.

Salmon are visual feeders so they only feed during the day. Feed content has been a contentious issue. Salmon in the wild feed on other fish while in a farming environment, they get pellets that are imported from Australia and Chile. The pellets are rich in protein and fat. The proportions are roughly 40% protein, 26% oil, carbohydrate 18%, along with a range of vitamins and minerals. The ingredients of the pellets meet all international standards for feed. In order to meet customer demands and ensure that wild fish stocks are sourced sustainably, fishmeal is substituted using plant proteins and animal waste proteins from other human food industries.

Salmon farming must be one of the few farming businesses in NZ that has to defend itself against a significant predator. As we discovered at the hatchery in Takaka a few years back both the hatchery and the farms are visited by seals keen for a feed of salmon. The seals are protected – so shooting them is not an option. All they can do is try and keep them out and at the same time capture and release any that do get into the farms.